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Subject:  Re: Recharacterization Question Date:  4/27/2001  10:06 PM
Author:  pmarti Number:  50657 of 123001

My husband and I each did partial conversions of our traditional IRA's in May, 2000. With the falling stock market, we decided to recharacterize in December. After that, but before the end of the year, we each did another partial conversion. Even though it may not have been necessary, we decided to keep it less complicated by having separate accounts for each transaction. We have filed an extension for 2000, and are currently trying to make sure everything has been accurately reported to the IRS.

Let's stop here for a second and make sure that you don't have a failed reconversion. If you recharacterize a conversion, as you did, you must wait until the latter of January 1 of the year following the initial conversion or 30 days after the recharacterization before you convert again. As long as your second conversion was of different assets than the first, I don't think you have a problem, although it's difficult to find anything directly on point. (We've looked when the issue came up in past threads.) If you reconverted the same assets, you definitely do have a failed reconversion.

Our tax person has asked for a total basis as of 12/31/99 for each of our traditional IRA's. I have looked at the 8606 and am not sure if this means all past contributions. If so,