Message Font: Serif | Sans-Serif
UnThreaded | Threaded | Whole Thread (3) | Ignore Thread Prev | Next
Author: madmikeyd Big red star, 1000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 124931  
Subject: Re: Yet Another Roth IRA Conversion Date: 1/10/2002 7:21 PM
Post New | Post Reply | Reply Later | Create Poll Report this Post | Recommend it!
Recommendations: 0
If I converted, what would be the tax liability? $873.81? ($2873.81 - the $2000 nondeductible contribution?) $2000? (The full value of the deductible contribution?) Would it be the current market value of the 2000 contribution?

The amount taxable will the FMV - an nondeductible contributions on the date of conversion, if this is your only IRA. Otherwise you will have to do prorating of your nondeductible contributions between the amount converted and remain Traditional IRA.

Thanks Paul. This is my only IRA, so if I read you correctly, if the FMV is $2873.81, and I had a $2000 nondeductible contribution, then conversion would produce $873.81 of taxable income? If this is the case, then conversion certainly does seem to make sense.

Post New | Post Reply | Reply Later | Create Poll Report this Post | Recommend it!
Print the post  
UnThreaded | Threaded | Whole Thread (3) | Ignore Thread Prev | Next


In accordance with IRS Circular 230, you cannot use the contents of any post on The Motley Fool's message boards to avoid tax-related penalties under the Internal Revenue Code or applicable state or local tax law provisions.
What was Your Dumbest Investment?
Share it with us -- and learn from others' stories of flubs.
When Life Gives You Lemons
We all have had hardships and made poor decisions. The important thing is how we respond and grow. Read the story of a Fool who started from nothing, and looks to gain everything.
Community Home
Speak Your Mind, Start Your Blog, Rate Your Stocks

Community Team Fools - who are those TMF's?
Contact Us
Contact Customer Service and other Fool departments here.
Work for Fools?
Winner of the Washingtonian great places to work, and Glassdoor #1 Company to Work For 2015! Have access to all of TMF's online and email products for FREE, and be paid for your contributions to TMF! Click the link and start your Fool career.