Wills, Trusts & Estates
Law Office of Steven M Berger, LLC


News & Updates

Converting to a Roth IRA

In 2010 the income limitation for converting traditional IRA to a Roth IRA will be eliminated. Furthermore, one half of the conversion income can be reported in 2011 and the final one half of conversion income can be reported in 2012. Whether paying the tax for future tax free withdrawals depends on many factors, but primarily on what tax rates will be when the money is withdrawn. That is a calculation you need to consult your tax and financial advisor on to determine its suitability for financial goals. From an estate planning technique the conversion to Roth reduces your total estate, but provides the same amount of future income by essentially prepaying income taxes. If your IRA gets stretched out over a long period of time as younger beneficiaries inherit the funds, the benefit of the conversion increases.