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I have a question about conversions and taxes. I am telling you what I am thinking of doing and what I think the tax consequences are. Please double check me.

I have a Rollover IRA in mutual funds that came from a previous employers 401K. The 401K was all before tax - ( payroll deductions ) on my part. My employer did a match and of course there were gains in the 401K. I Rolled the entire 401K into this Rollover IRA in 2008. No additional funds were added since.

I was looking at converting a percentage of this Rollover IRA to a Roth Conversion. I was looking to move about 50K into this new Roth. I plan to split the taxes between 2011 and 2012. So the way I figure it that means my income for tax purposes will increase 25K in years 2011 and 2012.
2010 taxes will not be affected Am I correct in this thinking?

I am staying at the 50K , 25K per year because if I do more it moves me into the next tax bracket.

Other factors that I do not think come into play but maybe I missed something.

I have another 401K at my present employer. It also has only before tax payroll deductions in it.

I also have another Roth IRA that I funded over the last several years with all After Tax money. I have already made my $6000 contribution for 2010. This is at a separate institution.

I do not have any other IRA accounts.

Have I missed or misread anything.


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