What are the benefits of a Roth IRA conversion?
Withdrawals • When your Roth IRA is held for 5 years and you reach age 59½, distributions are tax free. • Roth IRAs do not require annual minimum distributions at age 70½, unlike traditional IRAs. Taxes • If your peak earning years are yet to come, you may be in a higher tax bracket in retirement and may save in the long run by paying a lower current tax rate on pre-tax contributions and earnings. • If retirement is years away, you will have a longer time to accumulate potential tax-free growth within the Roth IRA. • You may want to minimize your taxes in retirement. Instead of waiting until retirement to pay taxes on withdrawals from non-Roth IRA retirement accounts, converting to a Roth IRA and paying those taxes now may provide for tax free distributions in retirement. • Since a Roth IRA doesn’t require withdrawals at 70½ (unlike non-Roth IRA retirement accounts), more funds can continue to grow to pass on to your beneficiaries free from income tax. • Since you pay any taxes due whe
