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Roth IRAs & Conversions

Found 25 Articles.
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Roth IRAs Are Compelling Estate Planning Tools

April 24, 2019

Roth IRAs can be powerful additions to your estate plan, regardless of your age. Most people focus only on lifetime income taxes when discussing roth iras. Roth IRAs can be powerful tools that help meet your Estate Planning goals, leaving your heirs with more after-tax wealth. An IRA will be included in your estate whether […]

Why This Could Be A Good Time To Convert Your IRA

January 23, 2019

You should regularly revisit the decision of whether or not to convert a traditional IRA to a Roth IRA, and recent events have made this an ideal time to re-evaluate the decision. A major reason people don’t convert their IRAs is the cost. The converted amount has to be included in gross income as though […]

When Converting to a Roth IRA Doesn’t Pay off

October 19, 2018

Near the end of the year is when many people consider converting traditional IRAs to Roth IRAs. Often in “Retirement Watch” and in my books, I explain when it is a good idea to convert your IRA. Since the advent of Roth IRAs, I’ve been at the forefront of determining when it makes sense to […]

The Most-Asked Roth IRA Question

August 27, 2018

This month we’re going to look at what lately has been the question I’m asked the most distribution from a Roth IRA isn’t tax free until at least five years have passed. Longtime readers know I believe rules of thumb and shortcuts are dangerous, and this is a good example. The summary stimulates a lot of […]

IRS Okays Backdoor Roth IRA

July 13, 2018

The Backdoor Roth IRA is a strategy available to someone who wants to contribute to a Roth IRA but whose income exceeds the contribution limit. The person can make a nondeductible contribution to a traditional IRA, and then convert that amount to a Roth IRA. There should be no income taxes on the conversion, if […]

More Scenarios When an IRA Conversion Makes Sense

May 24, 2018

Why bother with trusts when less than 1% of estates will pay estate or gift taxes? Many people are understandably, but mistakenly, thinking that way. Traditionally, tax savings were the primary reason to use trusts. But in 2018, individual estates worth up to $11.18 million are exempt from estate and gift taxes. Thanks to the […]

Good News: IRS Says 2017 IRA Conversions Can Be Reversed

February 20, 2018

The IRS recently announced that the prohibition on recharacterizations of IRA conversions doesn’t apply to conversions made in 2017. Since the first days of Roth IRAs, taxpayers have been able to convert traditional IRAs into Roth IRAs by including the converted amount in gross income and paying the taxes. Taxpayers also have been able to […]

How Will Tax Reform Change Roth IRAs?

September 28, 2017

We haven’t seen details of a tax reform bill, but there are some persistent rumors. One proposal is to reduce the Stretch Roth IRA. The Stretch Roth IRA is a great estate planning tool. You convert a traditional IRA to a Roth IRA, paying income taxes now and leaving your beneficiaries a tax-free source of income. […]

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