RMDs
Terry, I’m 72, I took my RMD in January, 2020. I don’t want to return my RMD to my traditional IRA account, can I do a ROTH conversion with this RMD? I already withheld 20% for tax. RMD=$30,000, withheld 20% tax= $6,000, ROTh converdion= $24,000.
Thank you.
Terry Says
Yes, you can return the entire amount withdrawn into a Roth IRA and it will be considered a conversion. But you must do it by August 31st.
You will not get the taxes that were withheld. They must be used for a credit next year.
but for example, if you took out $100,000 and they withheld 20,000, and you have money, you could roll the entire $100,000 to a Roth IRA.
Again, even if you took it out in multiple withdrawals, or early inJanuary or at any time this year — the ENTIRE thing could become a Roth conversion. Just remember it will all be taxable — andyou have a 20% head start on that for next year.
