HI,
I have been reading multiple posts online to see what option makes better for me.
I have some amount (e.g. $50,000) in IRA which I deducted for tax in the past years. I have $6000 in IRA which originally meant for deduction but it would be considered NonDeductible due to AGI limit.
Now, if I do the Roth IRA conversion (backdoor Roth IRA), after tax amount gets considered only little aprx. $500 and rest $5500, I have to pay taxes next year when I receive 1099-R form.
That means, even though I am converting ONLY NonDeductible amount, due to aggregation rule, it considers all my IRA amount and only considers $500 as tax free amount.
So, I do not see much benefit in doing conversion.
That being said, now, I am thinking more to keep the NonDeductible amount in the IRA account AS-IS... But, will there be any tax penalties or any issues in the future?
Thanks,
Bhavik
