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Well, ask a stupid question. I'm trying to understand about Roth IRAs as they have to do with retired people. I ask this yesterday and did not make myself understood. So I'll try again a different way.

Can I transfer $18,000 in stock certificates out of my company 401K plan as stock certificates, to a Roth IRA, paying the required taxes of appox. $2,700 now. Then, leaving it at least 5 years, get the appreciation, considering it does go up, tax free?

Could I also contribute an additional $2,000 each year here after? Or, is it true as I've been told, retired people cannot have a Roth IRA?
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First you would have to move the stock from the 401K to a regular IRA (assuming your 401K plan allows this). Then you convert the regular IRA to a Roth IRA.

You can only contribute to the Roth if you have earned income (ie. wages reported on a W-2 or self-employment income).

RBT
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towne,
Thank you so very much for answering me. I was beginning to think I'm crazy.
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<< Could I also contribute an additional $2,000 each year here after? Or, is it true as I've been told, retired people cannot have a Roth IRA? >>

One amplification on towne's correct response. A retired person can HAVE a Roth IRA and can convert traditional IRA funds to Roth, but you can't CONTRIBUTE to a Roth IRA (or a traditional IRA, for that matter) unless you have earned income.

Phil Marti
Tax Preparer
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