Roth IRAs & Roth Conversion IRAs
Hello,
Is there any reason NOT to commingle a client’s (a) Roth IRAs (funded w/ after-tax contributions) and (b) Roth Conversion IRAs (funded via conversion that can never be recharacterized) if the client is in their 40s and has had both (a) and (b) in place for well in excess of 5 years? State of NJ if applicable to know. Assume same beneficiaries so that isn’t a factor.
Thank you.
Jason
Permalink Submitted by Alan - IRA critic on Mon, 2018-08-06 18:43
No reason that these accounts cannot be combined. NJ treatment of TIRA contributions will usually result in conversions having a lower taxable amount on the state return than on the federal return, but that situation is not tracked any easier by maintaining separate Roth accounts.