IRA to Roth IRA conversions
My wife and I are 69 years old. We did a pre-tax IRA to Roth IRA conversion in 2021 and plan to do the same in 2022, 2023 and 2024 before we are required to have RMD’s from our IRA’s. First question – as of today barring a change in law are these still permitted in the next three years? Second question – does each yearly conversion have its own 5 year-requirement to withdraw earnings tax-free, but no restrictions to withdraw original investments at any time? Finally, since we are older than 59.5 years old, are there no restrictions at all to withdraw earnings as well as original investments at any time even at less than 5 years/
Terry Says
You can continue to do Roth Conversions.
As you know, all taxes must be paid in the year of the conversion. And the amount converted is added to your other income for tax purposes. Too much and you could pay taxes on your Social Security (unless you delay til age 70) AND on the premiums you pay for Medicare Part B and D.
Each conversion has its own 5-year period to wait to withdraw earnings tax-free.
Age 59-1/2 has no bearing on this. You’re way past this penalty period for your traditional IRAs.
Be sure to name a new beneficiary for your converted IRAs.
