@mjc4maureen wrote:
Hi Opus 17,
Or you meant my beneficiaries must pay income tax for withdrawing the earning of the Roth Conversion portion which occurs between 2018 and 2022 no matter when they withdraw. It could be 2032 they withdraw all at once, they still need to pay income tax for the earning of that Roth Conversion portion between 2018 and 2022. I don't know the answer. Shed the light again?
You have a personal Roth IRA clock that starts in the year you open your first Roth IRA. If you die more than 5 years after you opened your first Roth IRA, all withdrawals by your beneficiaries are tax-free. (Even if it is not the same Roth IRA. Your personal Roth IRA 5 year clock just counts from when you opened your first account.)
Since you opened your first Roth in 2005, you fulfill the 5 year holding period and all withdrawals by your beneficiaries will be income-tax free and penalty-free, no matter when the withdrawal is made. Withdrawal of contributions is never taxable. Withdrawal of conversions can sometimes trigger the 10% penalty but beneficiaries are exempt from this, and withdrawal of the earnings is non-taxable since you already fulfilled the 5 year holding period.
