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Pardon me, if this quetion has been answered in previous mails.
If I convert my current IRA to a ROTH IRA, would I be taxed on what I originally paid into the IRA or what the IRA is currently valued at? I, unfortunately, have lost money in the original value of my IRA.
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[[Pardon me, if this quetion has been answered in previous mails.
If I convert my current IRA to a ROTH IRA, would I be taxed on what I originally paid into the
IRA or what the IRA is currently valued at? I, unfortunately, have lost money in the original value
of my IRA.]]

You'll pay tax on the value of the IRA on the conversion date. That amount will be determined based upon the type of contibutions that you have made to your IRA in the past. (deductible vs. non-deductible)

For example, let's say that you made 3 prior deductible contributions of $2k each, for total contributions of $6k. But, because of losses, your IRA is now worth only $4k. When you do your conversion, you would be assessed tax on only $4k.

But, if you have also made non-deductible contributions to your original IRA, the rules could be a bit more complex. If you DO have non-deductible contributions in your IRA, and need additional help, please let me know and I'll be glad to give you those rules.

TMF Taxes
Roy

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Thanks for the help. I have ordered TMF Investment Tax Guide & am eagerly waiting to receive it.
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[[Thanks for the help. I have ordered TMF Investment Tax Guide & am eagerly waiting to receive it.]]

Great!!! I can't wait for you to receive it also. And I'll be interested to hear your thoughts on the book after you read it.

Thanks for the order AND your questions...
TMF Taxes
Roy
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