I have found the info on this to be confusing. I found the following chart to be very helpful. I wanted to know if my planned distribution from Roth would be Tax and Penalty free.
I am over 60 and my Roth account was established over 20 years ago, but I have made conversions within the last 4 years. So is my Conversion qualified? The chart says it is Qualified. I hope that is accurate. Does anyone know this for sure?
Looks good to me… but there is a Tax Board with specialists.
Wendy
Well, it’s not that your conversion is qualified - the question is - are your distributions qualified? Once you’ve had a Roth IRA open and funded for at least 5 years and are over 59 1/2, ALL distributions are qualified, no matter what the source is - contributions, conversions, or earnings.
Not sure where you got that chart, but a more authoritative source is IRS Pub 590-B 2024 Publication 590-B
The flowchart in Figure 2-1 walks you through whether your distribution is qualified or not.
Since the answer to the questions in the first 2 boxes is “yes” in the case that you described, any distribution will be qualified.
AJ
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AJ,
Thanks for the reply. I have been on TMF since about 2002 and have always enjoyed reading your posts. I used to post some in those early days, but am now 85 and haven’t posted in a long time. I am very disturbed about the current administration and want to reduce my equity position hence the question to make sure about the distribution. Thanks again, jg4
Just keep in mind that you don’t have to take a distribution to reduce your equity position. Selling equities within the IRA won’t necessitate taking a distribution. IRAs are like Vegas - what happens in the IRA stays in the IRA.
AJ
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