Couple of things to remember when converting to a Roth.
Your income must be 100,000 or less to roll over distribution.
I take the law, and it really hasn't been completely clarified, that you are taxed only on what you roll, therefore if you purchased the stock for 2000 initially, and it is now 300, you are only taxed on 300, and again this is spread over 4 years (if you so elect). Unless your stock has depreciated, and unless you are fairly young and have a lot of years left, more than likely you are better off leaving your current IRA alone. If you have non deductable IRA's because of being involved in another qualified plan, then you again are better off not rolling, but putting all future monies into a Roth.
Hope this sheds some light - I am a tax accountant, but there is still much discord on exactly how these rollovers are to be treated, so I would recommend that everyone check with a professional preparer, as your situation could be different.
Bob |
