ROTH re-characterization after 12-31-2017

Submitted by Charles Hart on Mon, 2017-12-18 22:09

What does the new proposed tax law say regarding the time limit on when an IRA conversion to a Roth in 2017 be recharacterized back to a traditional IRA and avoid paying the taxes



Submitted by Alan - IRA critic on Tue, 2017-12-19 16:09

Most likely, 2018 recharacterizations will be allowed since they apply to the 2017 tax year. But there is still doubt and considerable debate.

Submitted by Helen Disenhaus on Tue, 2017-12-19 17:42

Given the need to make conversions now, getting an answer immediately is critical to avoid “over” converting.

Submitted by Alan - IRA critic on Tue, 2017-12-19 20:21

  • I imagine IRA custodians are being asked this question. Perhaps one of the major ones has an insider contact with the IRS or someone on the tax writing committee. As soon as anyone with authority provides an answer it will be announced on all financial sites immediately. There might still be a chance for this to occur in the next couple of days, but after that there is no assurance that a recharacterization will get processed this year due to the usual year end issues. 

Submitted by Peter Lankes on Wed, 2017-12-20 16:19

Here is the actual Tax Bill if you wish to read about Roth Recharacterization under 2018 Tax Reform Lawhttp://docs.house.gov/billsthisweek/20171218/CRPT-115HRPT-466.pdf

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