The Motley Fool Discussion Boards

Previous Page

Financial Planning / Tax Strategies

URL:  http://boards.fool.com/ira-1-20000-ira-2-5000-ira-3-5000-i-wish-10422176.aspx

Subject:  Re: Roth IRA Strategies - Question Date:  11/18/1998  8:05 PM
Author:  TMFTaxes Number:  6370 of 121316

[[IRA #1 $20,000
IRA #2 5,000
IRA #3 5,000

I wish to convert $10,000 to a Roth IRA for 1998. Can I convert *both* IRA #2 and IRA #3 in
1998, or am I limited to converting only 1 account? Assuming I can only convert one account, can
I convert a partial account (ie. half of IRA #1) to meet the $10,000 I wish to convert?]]

As Bob correctly pointed out, Uncle Sammy considers that you have just one, big IRA with a total value of $30k. And, as Bob also pointed out, if you have any basis on any of the IRAs, that basis will be considered to spread out over the total IRA. The 1/3 example that Bob gave you was first class.

And, finally, as Bob pointed out, you can convert any amount. You don't even have to convert a "whole" IRA. In your example, you could convert $22k, or $3k, or $29k. Any amount that makes financial sense to you.

We discuss this issue in a bit more detail in The Motley Fool Investment Tax Guide. You might want to check it out.

TMF Taxes
Roy

Want to learn more about taxes and investing? Then we have a deal for you!! The Motley Fool Investment Tax Guide is now available through Fool Mart. Be the first one on your block to own this masterpiece. There is still time available to do that tax planning (and tax saving) before the end of the year. So just click on this link (http://www.foolmart.com/market/product.asp?pfid=MF+013+I) to read more about this amazing collection of tax information. (Apologies for the shameless plug…but it is a pretty good book…if I do say so myself). In addition, if you would like to visit the Taxes FAQ (Frequently Asked Questions) area, click on http://www.fool.com/school/taxes/taxes.htm and you'll be right at the home page. Pay special attention to the "archives" section. Check it out. Finally, if you need to get to the IRS web site, click on http://www.irs.ustreas.gov to go directly there.

Copyright 1996-2014 trademark and the "Fool" logo is a trademark of The Motley Fool, Inc. Contact Us