aja8888
Moderator Emeritus
I'm of the age where RMD's are required to be taken and I have previously done so for a few years now. This year, under the recent CARES Act, us old folks have been gifted with the option to take an RMD (if you want to) or just not do do for this year (waived for 2020). I have elected to NOT TAKE MY RMD for 2020.
But, I would rather do a Traditional IRA to ROTH IRA conversion for 2020 using the funds I would have pulled out as my RMD. I have looked around to see if I can do that, but only come up with this guidance from the IRS website:
The question I have relates to whether or not a conversion to a ROTH IRA is acceptable under this scenario and is opening up a ROTH IRA account (I don't have one open as on now) and putting the RMD funds into it considered a qualified rollover?
I have called Schwab on this and talked with three agents. Their website software to make the usual ROTH conversion indicates that I can't make the conversion unless I have already taken the required RMD amount for 2020. Two agents I spoke with couldn't help me get past the roadblock that I hit when I answered "no" to having already made the RMD conversion. The third agent said "just answer yes" (even though it's not truthful) to get past the RMD question.
I'm looking for some thoughts or advice on this situation.....Thanks!
But, I would rather do a Traditional IRA to ROTH IRA conversion for 2020 using the funds I would have pulled out as my RMD. I have looked around to see if I can do that, but only come up with this guidance from the IRS website:
Since the RMD rule is suspended, RMDs taken in 2020 are considered eligible for rollover. Therefore, RMDs can be rolled over to another IRA, another qualified retirement plan, or returned to the original plan.
The CARES Act provisions apply to most retirement plans, including traditional IRAs, SEP IRAs, SIMPLE IRAs, 401(k) plans, 403(b) plans, 457(b) plans, profit sharing plans and other defined contribution plans. The RMD suspension does not apply to qualified defined benefit plans.
The question I have relates to whether or not a conversion to a ROTH IRA is acceptable under this scenario and is opening up a ROTH IRA account (I don't have one open as on now) and putting the RMD funds into it considered a qualified rollover?
I have called Schwab on this and talked with three agents. Their website software to make the usual ROTH conversion indicates that I can't make the conversion unless I have already taken the required RMD amount for 2020. Two agents I spoke with couldn't help me get past the roadblock that I hit when I answered "no" to having already made the RMD conversion. The third agent said "just answer yes" (even though it's not truthful) to get past the RMD question.
I'm looking for some thoughts or advice on this situation.....Thanks!
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