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<<I am leaning toward withdrawing my mother's IRA ($5000.00 CD)and converting to a Roth.Something very safe.She is receiving Social Security at $14000.00/yr.Averaging the tax burden over 4 yrs., it would be $12500.00/yr.Is this added to Social Security for a gross income of $26500.00/yr for the next 4 years? The CD matures Jan. '99and something has to be done. My mother is 85yrs.>>

Based on the rules for Mandatory Required Distributions, you mother should have been taking taxable distributions from her IRA since age 70 1/2. Does she have other tax-deferred retirement accounts from which she has been withdrawing? If not she is liable for a very substantial tax penalty. Therefore, some portion of that 50K IRA maturing CD has to be paid out as a taxable distribution and possible tax penalty.

TMF Pixy - what is your read on this?

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