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Pls Confirm: Can I recharacterize Roth after Jan 1 to get 2016 ACA Subsidy?
Old 12-25-2016, 09:53 AM   #1
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Pls Confirm: Can I recharacterize Roth after Jan 1 to get 2016 ACA Subsidy?

I want to confirm that I don't have a 12/31/16 deadline to do a Roth recharacterization for purposes of bringing my MAGI under the 400% FPL to get an ACA subsidy for 2016. I think this is true but there is too much at stake to risk it.

I'm pretty busy with the holidays and don't really want to finalize the numbers, which requires estimating 12/31 CD and bank account interest and making sure I don't miss something. It'll be easier when I do my taxes later in January or February, but I want to make sure that it won't be too late then.

I had made a calendar note to check the numbers to see if I had room for more conversions under the 400% FPL, which I think would have to be done by 12/31, but it looks like I'm a bit over rather than under.
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Old 12-25-2016, 10:22 AM   #2
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If you did a 2016 conversion, you have until you file your return to recharacterize it and it will reduce you AGI which will in turn reduce your ACA income.

Quote:
The deadline for recharacterizing a Roth conversion or IRA contribution is your tax-filing deadline plus extensions. If you file the tax return on time (generally by April 15), you receive an automatic six-month extension, which means your deadline to recharacterize a 2015 contribution is October 15, 2016.
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Old 12-25-2016, 10:31 AM   #3
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Originally Posted by pb4uski View Post
If you did a 2016 conversion, you have until you file your return to recharacterize it and it will reduce you AGI which will in turn reduce your ACA income.
Thanks. That covers my situation.
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