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Author: ptheland Big gold star, 5000 posts Feste Award Nominee! Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 121482  
Subject: Re: taxes paid on Roth Date: 1/31/2000 2:27 AM
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I just converted Sep IRA to Roth and paid taxes. If I had not converted and I die before retirement do my heirs have to pay taxes on retirement account if my total estate is less than 650,000?

It seems like paying the taxes in advance may be negative. I realize the positive reasons for converting but this one has me puzzled.

Any help would be appreciated.


You're confusing the estate tax with income taxes. Your heirs would have to pay income taxes on your SEP IRA - but not on your Roth (this would be a qualifying distribution from a Roth). The $650K figure is for estate (and gift) taxes. I think IRA's are usually included in the taxable estate, so your conversion makes no difference for this tax.

Also I dont understand threaded vs un threaded messages. I am not sure where I will find this message.

The easiest way to find a response to your message is to click on "Favorites/Replies" on the blue title bar (at the top and bottom of message board screens). Then click on replies to my posts, and you're there.

--Peter
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