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Lev
Lev, Tax Advisor
Category: Tax
Satisfied Customers: 28084
Experience:  Taxes, Immigration, Labor Relations
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I am years old. I have $ 38,400.00 in a Traditional IRA,

Customer Question

I am 69 years old.
I have $ 38,400.00 in a Traditional IRA, that I never was able to deduct from my taxes.
My total basis in my traditional IRA, according to my tax records is $34,000.00.
Can I convert all to a Roth IRA, with a taxable amount to equal $4400.00? Or?
Submitted: 12 months ago.
Category: Tax
Expert:  Lev replied 12 months ago.

Yes - you may rollover funds from your traditional IRA to Roth IRA and you will be taxed on that conversion the same way as if you were taking distribution.

Thus - the basis $34,000 will be rolled over tax free and $4400 will be added to your other taxable income.

Let me know if you need any help with reporting.

Expert:  Lev replied 12 months ago.

You will receive form 1099R reporting your distribution.
The administrator doesn't have any knowledge about you having a basis in your IRA - so do not be surprised if the full amount of rollover will be reported as taxable.
When you file your tax return - you will report that rollover transaction on form 1040
line 15a - full amount $38400
and line 15b - taxable part of your distribution - $4400
The IRS shoudl know about your nondeductible contributions because every year you made nondeductible contributions - you reported these amounts on form 8606.
So theer should not be any questrions form the IRS.
Thus - you will have $4400 added to your other taxable income.
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