My income is lower in 2016 and with deductions I am in the 15% tax rate. Can I convert part of a Rollover IRA into a Roth IRA before April 15 to be taxed at 15% in 2016?

I noticed that my taxable income is significantly below the cut-off for the 25% tax rate. I would like to convert part of a Rollover IRA to a Roth IRA so that I can have that contribution only taxed at 15% — I think in the long term this is to my advantage. I discovered this in Feb 2017; is it too late to convert the money — i.e. did this need to be done before Dec 31 2016 or can I do this before April 15, 2017?

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1 Best answer

Level 15

Jun 5, 2019 5:32:04 PM

No. Conversions are reported for the tax year that the conversion takes place. A 2017 conversion would be reported next year on your 2017 tax return.

The April 18, date is for new IRA contributions, not conversions.

Level 15

Jun 5, 2019 5:32:04 PM

No. Conversions are reported for the tax year that the conversion takes place. A 2017 conversion would be reported next year on your 2017 tax return.

The April 18, date is for new IRA contributions, not conversions.

Level 4

Jun 5, 2019 5:32:05 PM

Thank you for the clear and timely reply. It's a shame we don’t have these extra months; one doesn’t realize that this opportunity exists — or the exact amount one can rollover — until one starts doing taxes after the new year starts.

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My income is lower in 2016 and with deductions I am in the 15% tax rate. Can I convert part of a Rollover IRA into a Roth IRA before April 15 to be taxed at 15% in 2016?