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Greetings, ESP, and welcome to Fooldom.

<<I'd like to second jmb's questions. As I understand it, rolling over into a Roth IRA will be treated exactly like taking a distribution - but without the 10 percent penalty that would normally apply for withdrawing before 59 1/2.

Does this mean that the rollover would be treated as normal income (i.e. it doesn't matter whether you sell the stock or not)? I also am interested in more details on how you calculate taxes on this - I've read that you can spread the tax out over 4 years. Does this mean that I spread the income out over 4 years (keeping me in a lower tax bracket each year), or do I report the extra income all in one year and pay the extra tax over 4 years?>>

Your understanding is correct. There is no 10% penalty and everything is treated as ordinary income. Take a look at my reply to JMB located just before this one. I think I answered your concerns there, but if not, just ask again.

Regards……Pixy
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