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Roth rollover distribution from traditional IRA

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    Roth rollover distribution from traditional IRA

    Client is rolling a traditional IRA into a Roth and paying taxes on the conversion.

    Is the Roth basis now treated like the client's contribution for non-qualified withdrawals (i.e. can be withdrawn penalty free), or will the client still have to pay a 10% penalty on non-qualified withdrawals since it came from a Trad IRA?

    And are there time limits?

    Thanks,

    #2
    You won't be taxed again on the same money.

    See also "Ordering Rules for Distributions" on p. 66 of Pub. 590.
    Last edited by appelman; 02-01-2011, 12:13 AM. Reason: correct typo
    Evan Appelman, EA

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      #3
      Thank you...

      Originally posted by appelman View Post
      See also "Ordering Rules for Distributions" on p. 66 of Pub. 590.
      Page 63-66 are great....thanks for the reference.

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