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Robin D.
Robin D., Senior Tax Advisor 4
Category: Tax
Satisfied Customers: 13608
Experience:  15years with H & R Block. Divisional leader, Instructor
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I am 75 years old and have lived in Thailand for 14 years.

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I am 75 years old and have lived in Thailand for 14 years. Between my Social Security and private pension, my income is about $3300/month. I have a TSA worth about $240,000 from teaching in the state of Wisconsin on which my MRD is usually about $9000. I can live well on $1000/month so I do NOT need additional income. I contribute to two 529 college plans for my grandsons and plan on doing the same for my two granddaughters in a few more years. I am considering converting my TSA to a Roth because I do not want any MRD but I realize the tax burden will be significant. Is there any method of doing income averaging over a period of five years or so to minimize the tax burden? I will appreciate any advice you can give me! I will most likely be cursed(?) with old age as my mother died at age 107. I workout at a gym daily and am in excellent health. Thanks, XXXXX XXXXX

Robin D :

Hello and thank you for using Just Answer,
Unfortunately, a distribution from your TSA plan would not qualify as a lump-sum distribution. This means you cannot use the special 10-year tax option to calculate the taxable portion of a distribution, which is what your TSA conversion would imply. Had you decided to do this in 2010, you would have been allowed to spread the tax over 2 years rather than just the conversion year.
I wish I could tell yo that you would not be taxed on the earnings all in the conversion year but the rules would not allow that.

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