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Greetings, Frontosa, and welcome. You asked:

<<Did I read correctly that earnings from Roth are tax exempt? If so am I correct that at retirement, the distributions from Roth are tax free, as opposed to Tradition IRA that is taxed as standard income? I've had trouble figuring out if there is a limit on AGI for contributing to ROTH, what is the story here?>>

You are correct that earnings may be taken from a Roth tax-free; however, you must be age 59 1/2 or older and the Roth must have been open for five tax-years at the time of withdrawal. Your ability to contribute to a Roth depends on your filing status and your adjusted gross income. A single filer may contribute up to $2K per year when AGI is $95K or less, a joint filer when AGI is $150K or less.

<<Once my 401k is in an IRA, would there be much reason to convert to a ROTH? The size of this one won't be larger that $15k, and my contributions (outside 401k) would not go into this IRA. >>

IMHO very few conversions make sense. Much depends on how the taxes due at that time will be paid, how long the money can stay in the Roth, your tax rate today versus that at withdrawal, and the size of plus your desires for your estate. For details on the type of things you need to consider, see my analysis in post 1567 on this board at


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