Eugene writes:
Hello Gina, I just read your informative blog post from June 17, 2007:
"Julie writes: I am thinking of making non-deductible IRA contributions this year and on and then convert to Roth IRA in 2010 . . . "
I have a very similar situation with current income that prevents me from contributing to a RothIRA I had established several years ago. I would also like do the exact same thing as Julia wrote about. My only question is how my SEP-IRA may interfere with this conversion in 2010 ?
Both my wife and I had each setup an SEP-IRA for our small businesses. You had written: "Third, since you already have a deductible IRA, you need to be aware that you cannot convert only the nondeductible IRA." Is it necessary that we also convert the SEP-IRAs? (I also have a small traditional deductible rollover IRA, which I will also be converting into the Roth in 2010.) If it's optional, do you recommend that convert the SEP-IRAs? (maybe we shouldn't, because the contribution limit is so high we can continue to contribute to the SEP vehicle for many years.)
Finally, my wife is a dentist and I'm a physician each with our own practices. Is it feasible for you to prepare or give second opinions for our tax returns from long-distance (we live in Ohio)?
My reply:
Hello Eugene, thanks for reading.
You are not required to convert your SEP-IRA, but you can if you want to. I have found a really neat tool online that you may find useful: https://personal.vanguard.com/
What I was trying to say in my post is that some people have two Traditional IRA accounts, some for their deductible contributions and another for their non-deductible contributions. If you choose to convert your "Tradiational IRA" that means you're converting all of your "Traditional IRAs". The same would be true of your SEP-IRAs. If you have more than one and you chose to convert them, you'd have to convert both. I cannot recommend whether or not you should convert since I really don't have enough information about your finances and retirement plans.
Over 95% of the tax returns I prepare are done via the Internet (email, fax, FedEx, etc.) and about 50% of them are out of state returns (I'm in Texas). I prepare returns for all U.S.individuals residing in the U.S. I file all allowed returns electronically and will provide you with both a PDF version of your return and then after it is accepted a paper copy. You can learn more about me, my practice and fees I charge by visiting my firm website.
Thanks again for reading.
Best wishes,
Gina
You are not required to convert your SEP-IRA, but you can if you want to. I have found a really neat tool online that you may find useful: https://personal.vanguard.com/
What I was trying to say in my post is that some people have two Traditional IRA accounts, some for their deductible contributions and another for their non-deductible contributions. If you choose to convert your "Tradiational IRA" that means you're converting all of your "Traditional IRAs". The same would be true of your SEP-IRAs. If you have more than one and you chose to convert them, you'd have to convert both. I cannot recommend whether or not you should convert since I really don't have enough information about your finances and retirement plans.
Over 95% of the tax returns I prepare are done via the Internet (email, fax, FedEx, etc.) and about 50% of them are out of state returns (I'm in Texas). I prepare returns for all U.S.individuals residing in the U.S. I file all allowed returns electronically and will provide you with both a PDF version of your return and then after it is accepted a paper copy. You can learn more about me, my practice and fees I charge by visiting my firm website.
Thanks again for reading.
Best wishes,
Gina
http://GLGcpa.com
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