How long do you have to establish a Roth with a IRA distribution?
I have a client who voluntarily withdrew money from his IRA. How long does he have to establish a Roth IRA with this distribution? The client is over 70 1/2 and understands the distribution is taxable.
Permalink Submitted by Alan - IRA critic on Fri, 2015-06-26 16:41
Client has 60 days to roll over an IRA distribution either to another traditional IRA or to a Roth IRA as a conversion. However, since client is 70.5 and subject to RMDs, only amounts in excess of the remaining RMD for the year can be rolled over or converted. Note that rolling the distribution over to a TIRA is subject to the new one rollover limitation in 12 months, while a conversion to a Roth IRA is not subject to any limitation other than prior completion of the RMD for the year.