Tackling the American Taxpayer Relief Act in 5 Easy Steps

Our friends over at Ed Slott’s website www.irahelp.com sent us a really great little one sheet last week and we wanted to share it with you!  Ed Slott is one of our favorite radio guests and one of the top IRA experts in the country.  We’ll break up the information for you over the next few days, and we hope you find it as useful as we did.

Step #4: Utilize new provision for in-plan Roth conversions.

You no longer have to be eligible for a distribution from your employer plan to go through with a Roth conversion as long as the plan has a Roth option (i.e. 401(k) to Roth 401(k)). Key points to consider: 1) In-plan Roth conversions CANNOT be recharacterized; 2) You must make sure you have the money to pay tax on the conversion; 3) Roth employer plans HAVE required minimum distributions  (RMDs); 4) You can utilize this provision for longer TAX-FREE growth in a Roth plan.

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