RMD’s and conversions
I understand that Conversions do not count in RMD computations. However, is there an order, during the course of a year in which RMD’s must be satisfied? For example, can I convert funds to my Roth during the course of the year and then in December use my IRS tax payment to satisfy my RMD amounts?
Permalink Submitted by Alan - IRA critic on Tue, 2022-12-27 17:23
Actually, all distributions including conversions are allocated to your RMD until the RMD is completed. But because a conversion is also a rollover and RMDs are not eligible for rollover, converting your RMD results in an excess regular Roth IRA contribution which must be removed. In other words, your RMD will be satisfied, but you end up with an excess contribution. Therefore, you must complete your entire RMD before converting additional amounts. If you want to use withholding, withhold from your RMD distributions, but decline withholding on your conversion. Starting in 2023, if you have multiple IRA accounts, you must complete your RMD for all of them before converting any amount. The RMD can be done in any combination of your IRA accounts under the aggregation rules.