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December 17, 2015

Converting Inherited IRA


Converting Inherited IRA

I recently inherited a Traditional IRA and would like to convert a portion of it to a Roth IRA. Am I allowed to do so?

It depends. If you are not the surviving spouse of the IRA owner, you are not eligible to convert the amount to a Roth IRA.

If you are the surviving spouse of the IRA owner, you can convert the amount to your own Roth IRA providing you elect to treat the Traditional IRA as you own before the conversion. One of the methods of treating the IRA as your own is by transferring the amount to your own (non-inherited) Traditional IRA. This option to treat the IRA as your own is available only to a surviving spouse beneficiary. Caution: If the decedent was required to take an RMD for the year of death, that amount cannot be included in the conversion, and must be withdrawn before the conversion.

Written By

Denise Appleby

Denise is CEO of Appleby Retirement Consulting Inc., a firm that provides IRA resources for financial/ tax/legal professionals. She has over 20 years of experience in the retirement plans field, which includes training and technical consultation.

Denise writes and publishes educational /marketing tools for advisors; available at Denise co-authored several books on IRAs

Denise is a graduate of The John Marshall Law School, where she obtained a Masters of Jurisprudence in Employee Benefits, and has earned 5 professional retirement designations.
She has appeared on numerous media programs, sharing her insights on retirement tax laws.


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