Aggregation of IRA conversions to a Roth IRA
Client’s spouse has $10,000 in a non deductible IRA that she wishes to convert to a Roth. This is the only IRA she has. Spouse has $500,000 in his 401k plan, and $100,000 in an IRA.
If she makes the conversion to a Roth, does she need to take into consideration for aggregation purposes what the husband’s 401k or IRA is worth?
Permalink Submitted by Alan - IRA critic on Thu, 2015-10-22 01:19
No, just her own TIRAs. A separate Form 8606 applies to each spouse when reporting TIRA non deductible contributions and conversions and calculating taxable amounts. There is no such thing as a non deductible IRA, only non deductible IRA contributions. So if she has made at least 10k of non deductible contributions and reported them on Form 8606, the conversion would be non taxable. Husband’s 401k does not affect her conversion either.