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Roth conversion question

Posted: Mon Mar 14, 2011 10:22 pm
by Abbey
DH had a small after-tax IRA (with some earnings) and converted it to a Roth in February this year. Can he still contribute to an after-tax IRA for 2010 & immediately convert it?
I'm concerned about the end-of-year classification of the IRA money and whether or not this will cause some of the previous conversion to be reclassified since a small part of it was tax-deferred.
Thanks very much.

Re: Roth conversion question

Posted: Tue Mar 15, 2011 10:28 am
by White Coat Investor
Abbey wrote:DH had a small after-tax IRA (with some earnings) and converted it to a Roth in February this year. Can he still contribute to an after-tax IRA for 2010 & immediately convert it?
I'm concerned about the end-of-year classification of the IRA money and whether or not this will cause some of the previous conversion to be reclassified since a small part of it was tax-deferred.
Thanks very much.
I believe he can. I did just that with a SEP-IRA this year. I made a 2010 contribution to it in March 2011, and then converted it to a Roth the next day. I'll pay taxes on the conversion in 2011 and get a deduction for 2010.

Posted: Tue Mar 15, 2011 9:56 pm
by Abbey
Thanks. I couldn't find a reference to exactly what we want to do and don't want to complicate anything. This helps.