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Age restrictions for Roth conversion?
Old 11-22-2013, 07:08 AM   #1
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Age restrictions for Roth conversion?

Once you reach 70 1/2 and have to take RMD can you still make conversions to a Roth IRA?

With our combined pensions, SS, and dividends from taxable accounts I estimate that once we turn 70 1/2 the resulting addition of RMD will put us in the 25% tax bracket with more income than we need for our living expenses. Instead of taking the distribution and putting the money in a taxable account is it possible to use the RMD for a conversion to a Roth instead? Or would that not be considered taking the RMD?

I guess that is two questions. If the second question is not possible then any suggestions for how to deal with that situation are welcome.

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Old 11-22-2013, 07:48 AM   #2
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Looks like there is no age restriction. I found this article useful on the why / why-nots of conversion:
Post-Retirement Roth Conversion Fairmark.com Fairmark.com
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Old 11-22-2013, 09:12 AM   #3
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Originally Posted by travelover View Post
Looks like there is no age restriction. I found this article useful on the why / why-nots of conversion:
Post-Retirement Roth Conversion Fairmark.com Fairmark.com
Maybe it's buried in there but I didn't see it..........you cannot convert the RMD and since RMDs must come out first (or are considered to come out first), in order to do a conversion, you need to pull the RMD first, then pull additional funds to convert. Kind of a dilemna since you then have to worry about higher medicare B premiums if you get too high but perhaps you might want to console yourself by knowing there could be worse problems to have
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Old 11-22-2013, 10:36 AM   #4
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Maybe it's buried in there but I didn't see it................
Sorry, a better reference:

RMD and Roth Conversion

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People receiving required minimum distributions aren't allowed to roll them over to another IRA or retirement plan — and that means they aren't allowed to convert these payments to a Roth IRA. What's more, the IRS says the first dollars that come out of a traditional IRA in a year for which the RMD rule applies must be treated as RMD dollars. In effect, they are saying you have to satisfy the RMD requirement before you do a Roth conversion.
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Old 11-22-2013, 10:38 AM   #5
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Maybe it's buried in there but I didn't see it..........you cannot convert the RMD and since RMDs must come out first (or are considered to come out first), in order to do a conversion, you need to pull the RMD first, then pull additional funds to convert.
That is how I understand it as well. I know a couple of folks who are in their 70's and doing ROTH conversions so that it is better for their children when they inherit them.
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Old 11-22-2013, 10:49 AM   #6
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Originally Posted by travelover View Post
Sorry, a better reference:

RMD and Roth Conversion
Thanks for clearing that up. I kind of figured it would work this way. Bummer!

Cheers!
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