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"It was my impression that minors NEEDED a custodial account since they were NOT allowed to own securities in their own name. How could a 17 year old be listed as the owner of stock?"

>>>> Not according to Waterhouse. I filled out the forms with my daughter's name and signature. They could see her birthdate made her a minor, but they processed it as a regular IRA. My guess is that custodial accounts require some sort of UGMA or trust legal framework, both of which are incompatible with the IRA framework. Maybe TMF Pixy can help us out on this.<<<<

"So, dcunited, you are going to leave the 97 IRA alone with its contribution, and not roll it into a Roth? Or are you planning to stay with the traditional IRA format?"

No, I expect to roll it into a Roth, given that my daughter is in the 15 percent bracket now, and will likely remain there for the next 3-4 years when the tax payments for the Roth conversion come due. It's reasonable to assume her withdrawals at retirement will be taxed at a higher bracket rate, so that argues in favor of conversion. Of course, there is still the problem of trying to project what the tax structure might look like 50 years from now, and how that might affect the tax advantages of the Roth over the conventional IRA. Haven't figured that one out yet. :-)

The biggest question in my mind is: should I have her declare her '97 IRA as deductible or non-deductible. I guess it won't make much difference taxwise, and she could take the full deduction immediately, while paying it back over 4 years, getting in effect an interest-free loan from Uncle Sam. What are you planning to do on this?
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