Transferring to a Roth Easier in 2010

Currently the rule goes something like this if you have a traditional IRA and want to convert it to a Roth IRA it’s mighty hard to do so because of MAGI (modified adjusted gross income) limitations. That is if your modified adjusted gross income (MAGI) is more than $100,000, you can’t do it. But now in 2010, this rule is being pushed aside.

The advantage of the Roth is that while contributions are not tax deductible and qualified distributions are tax free. So once you’ve paid your taxes, you’re done and won’t get stuck with taxes when you need the money the most, upon withdrawal.

Distributions on a Traditional IRA are mandatory at age 70.5 years. The Roth allows for penalty-free distributions as early as 59.5 years of age.

If you thinking that a 2010 Roth conversion might make sense for you, it’s best to talk with a professional financial advisor and look at your whole situation. You can get a free assessment at Coors Credit Union by call their Investment and Retirement Team at (303) 279-6414 or (800) 770-6414 between 9:00 AM and 5:00 PM Monday through Friday.

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