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Roth Conversion

February 5th, 2010 at 12:35 pm

I converted two thirds of our Traditional IRA accounts to Roth IRA's today. It's a bit scary to pull the trigger, when you know it is a taxable event.

I'm have already looked into the tax consequences and they are quite favorable for us as most of our earned income will not be taxed this year due to the combat zone exclusion. Of course, we still have to pay taxes, but not much different than a normal year for us.

I will decide about the remainder of the IRA balances later.

4 Responses to “Roth Conversion”

  1. fern Says:

    Sounds great!

  2. Broken Arrow Says:

    Good for you! In fact, the market stayed even lower for the most part. I think you did just dandy!

  3. creditcardfree Says:

    BA, it did work out. I'm happy to have nearly locked in yesterday's prices.

  4. In Debt Says:

    Great move!! It makes perfect sense when you are certain 2010 will be in a lower tax bracket than you'll likely find yourselves in retirement.

    I need to get my act together...and figure out how much of my Traditional IRA I can afford to convert (how much extra tax I can pay), get the new Roth account set up, and pray I pull the switch on a day that the market is down.

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