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Author: pmlyons Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 75794  
Subject: aroth IRA Date: 2/24/1999 8:20 PM
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I have been faithfully investing in regular IRA's for me and my spouse. Last year our income was over the phase-out limit for establishing a Roth IRA, but this year, because investment reurn was down, we will probably be below the 150K income limit. How much of our regular IRA can we convert to a Roth IRA?

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Author: JAFO31 Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 8788 of 75794
Subject: Re: aroth IRA Date: 2/25/1999 1:27 AM
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Pmlyons: you wrote, "I have been faithfully investing in regular IRA's for me and my spouse. Last year our income was over the phase-out limit for establishing a Roth IRA, but this year, because investment reurn was down, we will probably be below the 150K income limit. How much of our regular IRA can we convert to a Roth IRA?"

I am no expert, but I believe that you are still out of luck regarding a conversion. My ecollection of the rules is that AGI <$150,000 for married couple filing jointly to contribute to a Roth IRA, but AGI <$100,000 for married couple filing jointly is the limit for conversions.

I ahve never understood the reasoning, if there really is any (:>), behind the difference. One of the regular experts can chime in if I my memory is faulty.

Regards, JAFO



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Author: TMFPixy Big gold star, 5000 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 8797 of 75794
Subject: Re: aroth IRA Date: 2/25/1999 10:04 AM
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Greetings, Pmlyons, and welcome. You asked:

<<I have been faithfully investing in regular IRA's for me and my spouse. Last year our income was over the phase-out limit for establishing a Roth IRA, but this year, because investment reurn was down, we will probably be below the 150K income limit. How much of our regular IRA can we convert to a Roth IRA?>>

Conversion of funds in a traditional IRA may be for any amount provided your Adjusted Gross Income as modified is $100K or less. If yours still hovers around $150K, then you can't convert a penny. You may, though, make an annual contribution of $2K to a Roth IRA for yourself and another $2K to a Roth IRA for your wife. Those contributions come from your earned compensation for the year (i.e., job wages), so they have already been taxed. Between a joint AGI of $150K and $160K the amount you may contribute to a Roth is reduced, and above $160K you can't use it at all. At that level, though, you may still make a full $2K contribution to a nondeductible traditional IRA. See IRS Publication 590 (Individual Retirement Arrangements) available at www.irs.gov and my IRA discussion in the Foolish Retirement Plan Primer at http://www.fool.com/Retirement/Retirement.htm for details.

Regards…..Pixy



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