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Subject:  Re: Trad IRA to Roth Conversion Date:  6/14/2008  1:39 PM
Author:  TMFPMarti Number:  101048 of 127613

In my traditional IRA I have some contributions which were non-deductible. Can I convert those funds over to my Roth IRA without tax consequences or is there an income limitation for doing that?

No, you can't, and yes, there is, but the income limit for conversions ($100,000) isn't the reason you can't do what you want to do.

A conversion to Roth is a distribution from your traditional IRA. When you have nondeductible (after-tax) money in a traditional IRA, a portion of each distribution is a tax-free return of that after-tax money, and a portion is a taxable distribution of previously untaxed earnings and deductible contributions. The taxable portion is calculated in Part I of Form 8606.

See Publication 590.

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