IRA Rollover

Posts Tagged ‘rollover ira roth conversion’

Question: conversion traditional to roth question?

i had 5200 in earned income in 2007 so no tax liaibility so decided to convert traditional to roth. on my W4 with my employer i listed a 4000 IRA deduction. Is this a problem? I still won’t owe any taxes in 2007 and had nothing withheld. I just wont list the deduction on my tax return correct since i am now using after tax income in the Roth? Please give me a detailed answer. Thank you!

can i just keep the 4000 deduction and report the 4100 conversion amount on line 15b ira distribution and write “rollover” Thus i would only pay taxes on the earnings. i dont want to file form 8606 unelss i have to. can i do this?

Answer: What you are doing is not a rollover. It is a conversion.

You need to show your traditional IRA deduction of $4,000. Then, you need to record your conversion using Form 8606.

ROTH IRA CONVERSIONS