Roth Conversion – 5 year period
I have a question for the conversion of a traditional IRA to a Roth IRA. For someone older than 59 1/2, when converting a little bit of the traditional each year, does each conversion have its own five year period?
For example, if a conversion is done in November, 2021, the five-year period starts January 1, 2021 for that specific conversion.
If another conversion is done October, 2022, the five-year period for that conversion begins January 1, 2022. Is this correct?
Thank you.
Joe
Permalink Submitted by Alan - IRA critic on Thu, 2021-06-03 01:37
No. After 59.5, there are no new conversion 5 year holding periods, and any prior conversion holding periods not yet completed are also no longer applicable. That means that any conversion done at anytime can be tapped without tax or penalty.