For the first 6 months of the year, I was an employee of a company that didn't have any kind of retirement plan
. As such, I regularly contributed to my traditional IRA
. I am now self-employed, and I have setup and contributed to a SEP-IRA.
In other words, I was not "an active participant of an employer-sponsored plan" for the first half of the year. But I am now.
I am aware that I will not be able to deduct any of these contributions that I made to my traditional IRA.
The contribution amount to the traditional IRA is $2,560.
I believe my Modified Adjusted Gross Income
for the year will be at or less than $120,000.
According to my calculations, I believe that I am allowed to contribute this full amount to a Roth IRA
. And, since I can't deduct these contributions, I would rather put them into a Roth account vs a traditional IRA.
Is it possible to "re-characterize" these contributions, and have them instead go into a Roth IRA? (I can setup a Roth account with the same company that I have my traditional IRA account with.)
Also, I don't currently have a Roth IRA. If re-characterization is possible, what is the time limitation
I'm faced with. That is, can I open the Roth IRA and re-characterize any time before April 15th 2014? Or do I have to have the Roth account open by the end of the year. Or do I have to complete both by the end of the year 2013?
I have other funds in the Traditional IRA (e.g. from 2012). Does this affect a re-characterization?