5 year clock on conversion for over 70 y o

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My financial advisor told me that converting from a Traditional IRA to a Roth IRA will start a new 5-year clock on each conversion and the earnings will be taxable if I withdraw prior to the 5-years. However, I want to clarify whether that's actually true in my situation.

I opened my Roth IRA in 2021 and I am over 60 years old, so the age is not an issue. I plan to do two Roth conversions — splitting amounts from my Traditional IRA into my existing Roth IRA in 2026 and 2027 — but I am concerned about whether I'll have to wait 5 years before I can access the earnings from those conversions.

Is my advisor correct that each conversion restarts a 5-year clock, or does my existing Roth IRA (opened in 2021) satisfy the requirement so that earnings from the conversions are immediately accessible?

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Opus 17Answer

Level 15

Expert Reviewed

If you are over age 59-1/2, you can ignore the clock on conversions. The only tax for withdrawing a conversion early is the 10% penalty for early withdrawal, and that penalty does not apply if you are over age 59-1/2.