Roth Recharacterization

[tpert]

Taxpayer took 50K distribution from 401K plan and rolled it over to a Roth IRA and now realizes that he is not eligible to recharacterize in 2008.

Is this a situation where the recipient plan can be "recharacterized" as a regular IRA to avoid all of the taxes and penalties involved?

Taxes: 28% Federal + 10% penalty, 9% State + 2.5% penalty plus 6% excess contribution penalty if left in the Roth for anything over

If it is eligible for recharacterization, am I correct that this must be done by the due date plus extensions?

Thanks

[Jesse]

To quote myself

Definitely helps, Thank you!

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

In case anyone else needs a direct link.

Your thinking seems to be correct.

This link should take you directly to the recharacterization info.

[tpert]

Thanks.

Most of the text talks about recharacterizing a conversion from a regular IRA to a Roth IRA back into a regular IRA, but since they allow 401Ks to be converted to Roths, I would think that you could recharacterize a conversion from a 401K to a Roth back into a regular IRA as well...

I hope the banks allow them to do this.