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Financial Planning / Tax Strategies


Subject:  Re: Roth Conversions Date:  5/22/2019  12:13 PM
Author:  aj485 Number:  129267 of 132775

For a Roth conversion to be taxed in 2019, does it have to be done by 12/31/19 or 4/15ish/2020?

Needs to be complete by 12/31/19

We are trying to do conversions up through the 24% tax bracket but figuring out taxes can be tough to do in advance. Tracking income as it comes in best we can, but if it can wait until April, like a contribution can, that would be easier.

Yes, that's the one thing that the TCJA did that made Roth conversions less palatable - you used to be able to recharacterize part of your Roth conversion, so if you ended up converting enough to push you into the next bracket, you could get a do-over and pull part of it back out. You are no longer allowed to do that, so you just have to go with your best guess, and if you end up with a few hundred dollars in the 32% bracket, you'll have to pay the extra $8 per hundred.

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