Roth conversion to traditional IRA

[Jesse]

Taxpayer converted several thousand from a traditional IRA, doesn't like the tax bill and now wants to convert back. Financial advisor says taxpayer can do this as long as it is before 4/15/09 - and wants me to re-do the taxes.

The original conversion took place last September - how can this be done?

My mind is swimming, am I missing something?

[rghtax]

Recharacterization can be done on 2008 conversion until 10-15-2009

[Mo Sheets]

Some Help....

I received a pamphlet from Harrison Building and Loan (a local savings and loan in Harrison, OH) which listed this question:

Q. After I converted to a Roth IRA, I spoke with my tax advisor. He said it wasn't a good idea in my situation. Can I reverse the transaction?

A. Yes. You can recharacterize the transaction back to a Traditional IRA contribution, provided it is done before the due date of your tax return for the year of the contribution, including extensions.

I don't really have first hand experience with this but thought I would pass this along in case someone with more experience doesn't reply. I believe they call these "a failed conversion."

Also, I do know there is a new rule in 2010 that will allow someone to convert money from a Traditional IRA to a Roth IRA even if there income is over $100,000. It will also allow them to defer taxation until 2011 and 2012, if desired.

Hope that helps!

Mo

[Jesse]

Definitely helps, Thank you!

http://www.irs.gov/publications/p590/ch01.html#en_US_publink10006260

In case anyone else needs a direct link.