Question re RMDs and Roth Conversions

[misanman]

For those of us who are subject to RMDs, it has been my understanding that the IRS required that the RMD be satisfied first before a Roth conversion could take place.

I went through quite a bit of effort to ensure that we followed the "rules" last year with respect to DW's tIRA, but as I was working through this years income tax (using TurboTax) I didn't notice anything that addressed the specific timing of tIRA distributions (either RMD or Roth conversion).

So does it really matter the order in which they occur? Or could we have done a Roth conversion first followed by a distribution to satisfy the RMD?

Maybe I just missed it

 

[haha]

For those of us who are subject to RMDs, it has been my understanding that the IRS required that the RMD be satisfied first before a Roth conversion could take place.

I went through quite a bit of effort to ensure that we followed the "rules" last year with respect to DW's tIRA, but as I was working through this years income tax (using TurboTax) I didn't notice anything that addressed the specific timing of tIRA distributions (either RMD or Roth conversion).

So does it really matter the order in which they occur? Or could we have done a Roth conversion first followed by a distribution to satisfy the RMD?

Maybe I just missed it

Fidelity requires that the RMD be completed before any conversions are made.

Ha

 

[Whisper66]

Interesting question I never thought about. Looks like the following info supports Ha's comment....need to take RMDs out before making Roth converion.

Roth Conversion: Take Your Required Minimum Distribution Out First | FiGuide

 

[misanman]

Okay, so it seems that the ordering rule is enforced by the organization that holds the account (Fidelity in my case) rather than at tax return time.

Our case was a little complicated as early in 2016 we did RMD followed by a Roth conversion but then, at tax time, we realized that we had some unexpected 2015 income which required that a 2015 Roth conversion be re-characterized to stay with acceptable tax brackets. That re-characterization changed the end-of-year balance and thus the 2016 RMD amount. Since we had already withdrawn the lower RMD amount and then performed the Roth conversion we would have been in violation. I don't know whether Fidelity would have caught this or not.