taxes

Roth conversion payback

10 new tax law changes to know
Next
Slide 8 of 11
Back
Tax return laws

If you converted a traditional IRA to a Roth IRA in 2010, you probably elected the default tax payment option in connection with your retirement plan conversion.

That choice allowed you to defer the IRA conversion tax last year and spread payment of it over two future years. Half of that payment is now due.

You must report half of the taxable IRA conversion amount on your 2011 return. The remainder will be reported and paid on your 2012 return.

What if you have some extra cash and want to pay all the IRA conversion taxes on your 2011 return? Sorry. You are stuck with the two-year payback. So stash that money in an interest-paying account so you'll have it (and a bit more) for your 2012 filing.


Next
Slide 8 of 11
Back

 

advertisement

Show Bankrate's community sharing policy
          Connect with us
advertisement
MORTGAGE HOME EQUITY AUTO CDs CREDIT CARDS
Product Rate Change Last week
30 year fixed, 0 point 4.27%  0.05 4.22%
15 year fixed, 0 point 3.27% --0.00 3.27%
5/1 ARM 3.35%  0.13 3.48%
 
View Rates in your area Next
Product Rate Change Last week
30K FICO-based HELOC 4.38%  0.08 4.46%
50K FICO-based HELOC 4.11%  0.06 4.17%
100K FICO-based HELOC 3.96%  0.03 3.93%
 
View Rates in your area Next
Product Rate Change Last week
60 month used car loan 2.73% --0.00 2.73%
48 month used car loan 2.97%  0.04 2.93%
60 month new car loan 3.22%  0.05 3.17%
 
View Rates in your area Next
Product Rate Change Last week
1 Year CD 0.90%  0.02 0.92%
2 Year CD 1.09% --0.01 1.08%
5 Year CD 1.74% --0.00 1.74%
 
View Rates in your area Next
Product Rate Change Last week
Balance Transfer Cards 15.67%  0.02 15.65%
Cash Back Cards 16.36%  0.03 16.33%
Low Interest Cards 10.87% --0.00 10.87%
 
Next
DAILY TAX TIP NEWSLETTER

Get expert advice during tax season on tax preparation and tips for cutting your tax bill.

advertisement

Connect with us