topic Re: Why must RMD be completed before doing ROTH conversion in Retirement tax questions

Why must RMD be completed before doing ROTH conversion

Linfyamatt — Tue, 03 Feb 2026 15:56:32 GMT

Can IRA to ROTH conversion be done before completing RMD withdrawal

Re: Why must RMD be completed before doing ROTH conversion

Opus 17 — Fri, 14 Mar 2025 15:54:38 GMT

"Can IRA to ROTH conversion be done before completing RMD withdrawal"

No, because that's the law. The intent of IRAs is to create money to use in retirement, not to create tax-free money to pass on to your heirs. That's why there is an RMD requirement in the first place, you must withdraw at least some money and pay tax on it, based on your remaining life expectancy. For the same reason, you must withdraw your RMD first so you can pay tax on it, before you can convert any of the pre-tax IRA to a Roth IRA.

Re: Why must RMD be completed before doing ROTH conversion

dmertz — Fri, 14 Mar 2025 16:14:33 GMT

The tax code says that in a year for which you are required to take an RMD, the first amounts distributed are RMD. Because an Roth conversion is a special type of distribution and rollover, and an RMD is not eligible for rollover, the RMD must be satisfied before doing any conversion.

If you to the Roth conversion first, an amount that is ineligible for conversion (because it is RMD despite your desire for it not to be) is deposited into the Roth IRA and becomes an ordinary Roth IRA contribution, not a conversion. If that ordinary Roth IRA contribution exceeds the maximum that you are permitted to contribute for the year, you have an excess contribution to the Roth IRA.

Even if you were permitted to do a Roth conversion before taking the RMD, the only case I can think of where if might be beneficial to do that is if the year is the first year for which you are required to take an RMD and you wanted to delay the RMD income to the following year by taking that distribution in that following year by April 1.

Re: Why must RMD be completed before doing ROTH conversion

user17582967402 — Fri, 19 Sep 2025 15:48:15 GMT

re statement above : "...For the same reason, you must withdraw your RMD first so you can pay tax on it, before you can convert any of the pre-tax IRA to a Roth IRA. .."

Do not understand.

If I do Roth conversion on Monday and then RMD on Friday, there is ZERO tax difference than if I did RMD on Monday and then Roth on Friday.

Right?

Re: Why must RMD be completed before doing ROTH conversion

Opus 17 — Fri, 19 Sep 2025 23:09:52 GMT

@user17582967402 wrote:

re statement above : "...For the same reason, you must withdraw your RMD first so you can pay tax on it, before you can convert any of the pre-tax IRA to a Roth IRA. .."

Do not understand.

If I do Roth conversion on Monday and then RMD on Friday, there is ZERO tax difference than if I did RMD on Monday and then Roth on Friday.

Right?

No. It is technically incorrect, as explained by @dmertz . By operation of law, taking money out of the IRA on Monday is automatically the RMD, and thus not eligible for rollover (assuming you have not withdrawn any other funds earlier in the year).

You might not get caught, but it is technically incorrect, and if there is an audit, you can be assessed whatever penalties and taxes apply.

Re: Why must RMD be completed before doing ROTH conversion

dmertz — Sat, 20 Sep 2025 00:14:30 GMT

As Opus 17 and I explained, under the tax code there is a taxable difference. If the purported Roth conversion occurred first, the amount converted up to the amount of the RMD would constitute a failed conversion. Reporting that portion on your tax return as a completed conversion would mean that you were filing inaccurate tax return (only making it seem like there is no taxable difference). The RMDs for all of your traditional IRAs must be satisfied before doing Roth conversions of any other amounts from your traditional IRAs.

Re: Why must RMD be completed before doing ROTH conversion

user17717088430 — Sat, 21 Feb 2026 21:36:44 GMT

That answer makes no sense. When you do a conversion from a traditional IRA to a Roth, you pay tax on the amount converted. It should make no difference what the reason to do the conversion is, whether it is to accomplish an RMD or simply to move the money from one account to the other. Either way, you must pay the tax on the converted amount. Obviously, IRS just wants to prevent a Roth conversion from being used to satisfy the RMD, even though from a tax collection perspective it would make absolutely no difference. The IRS does not want its forced distributions going into a Roth, solely to prevent money from moving from a traditional IRA into a Roth. This contradicts express statutory public policy. I am not aware of any statutory basis for this. It is simply made up IRS tax policy to discourage Roth investments and to maximize tax collections, which actually is not the lawful statutory mission of the IRS. The IRS's directive is simply to collect fully and fairly taxes due, not to make up non-statutory rules and regulations that contradict statutory intent solely to maximize tax collections.

Re: Why must RMD be completed before doing ROTH conversion

Opus 17 — Sat, 21 Feb 2026 23:35:03 GMT

@user17717088430 wrote:

That answer makes no sense. When you do a conversion from a traditional IRA to a Roth, you pay tax on the amount converted. It should make no difference what the reason to do the conversion is, whether it is to accomplish an RMD or simply to move the money from one account to the other.

You are missing the entire point of the RMD. You can't keep retirement money in a tax-advantaged account forever. You are supposed to withdraw it and spend it. Essentially, the tax deferral has a built-in expiration date.

As a result, one of the things you can't do with your RMD is to move it into a different tax-deferred account. Even though you are taking a distribution and paying the income tax, you are moving it into a Roth account, which is another form of tax deferral. You can't do that. You have to withdraw your RMD, pay tax on it, and either spend it or invest it in a traditional taxable invest. After you have taken the RMD, you can think about moving additional funds from one tax-deferred account to another.

Anyway, it doesn't matter whether you like it or not. That's how the law and regulations are written. Period.

Re: Why must RMD be completed before doing ROTH conversion

dmertz — Sat, 21 Feb 2026 23:36:40 GMT

"That answer makes no sense."

Sensible or not, it's the law.

Re: Why must RMD be completed before doing ROTH conversion

user17717088430 — Sun, 22 Feb 2026 00:12:31 GMT

I did not say it was not the IRS's position on it's regulations and rules. I said it is inconsistent with the public policy of the Tax Code as adopted by Congress. Nevertheless that is another nonsensical answer because that wasn't the explanation the post offered. The post attempted to justify the IRS's position by suggesting that a traditional IRA conversion to a Roth by means of an RMD would somehow avoid taxes. That is completely false. If you want to say that's the way it is because the IRS says so, fine. But don't make inaccurate statements about the IRS's justification.

Re: Why must RMD be completed before doing ROTH conversion

dmertz — Sun, 22 Feb 2026 03:08:21 GMT

"The post attempted to justify the IRS's position by suggesting that a traditional IRA conversion to a Roth by means of an RMD would somehow avoid taxes."

I don't see anywhere in this thread that that is suggested.

Re: Why must RMD be completed before doing ROTH conversion

user17717088430 — Mon, 23 Feb 2026 20:00:19 GMT

I guess you didn't read the post. The primary purpose of a tax deferred account is to reduce taxes. From the post:

"As a result, one of the things you can't do with your RMD is to move it into a different tax-deferred account. Even though you are taking a distribution and paying the income tax, you are moving it into a Roth account, which is another form of tax deferral. You can't do that."

Re: Why must RMD be completed before doing ROTH conversion

user17582967402 — Mon, 23 Feb 2026 20:16:46 GMT

I am not trying to take any advantage of tax system.

Option 1 - take RMD on Monday. Then move money to ROTH on Tuesday. Perfectly legal. All is fine.

Option 2 - Move money to ROTH on Monday, and then take out RMD on Tuesday. That causes big problems and subject to 6% penalty.

Here is the crazy part. The money involved is the same in both situations. Not tax advantage doing it one way vs the other. The RMD amount was FIXED back on Dec 31st.

Re: Why must RMD be completed before doing ROTH conversion

user17717088430 — Mon, 23 Feb 2026 20:44:33 GMT

Thanks. All true, provided you haven't already maxed out ROTH contributions in the tax year of the RMD. Of course, that would not matter if you are doing a Roth conversion at an age before RMDs are due. It also should not matter after. There is no statute that authorizes the IRS to prevent traditional IRA RMD funds, on which taxes are fully paid, from being converted to a Roth. Congress created Roths. Roths are not only lawful, they are encouraged. Unfortunately, the IRS probably will never be challenged in Tax Court because the amounts involved are so small and the costs to challenge are so great. That does not mean the IRS position is lawful. It does things every day that are contrary to law. Not necessarily intentionally. It's just an institutional bias. But many thanks nonetheless.

Re: Why must RMD be completed before doing ROTH conversion

Opus 17 — Mon, 23 Feb 2026 21:04:52 GMT

I'm going to bow out of this conversation except to say:

Option 2 violates the regulations. The regulations say that if an RMD is required, the first money to come out of the account is the RMD. That means the first transaction is a "failed rollover" and the money is taxable etc.

If you don't like the law, you need to get Congress to change it. If you think the regulations interpret the law incorrectly, you can sue the IRS, or pay a minimum of $10,000 for a private letter ruling.

As a practical matter, you are correct that everything that happens in a single tax year is reported at the same time, and it would be difficult for the IRS to catch you performing option 2. And even if they catch you, the examiner might recognize your argument and use their discretion to overlook it.

Re: Why must RMD be completed before doing ROTH conversion

dmertz — Mon, 23 Feb 2026 21:31:04 GMT

"There is no statute that authorizes the IRS to prevent traditional IRA RMD funds, on which taxes are fully paid, from being converted to a Roth."

The statutes absolutely do prohibit such a conversion. Section 408A(d)(3) defines a Roth conversion as a taxable rollover. Section 408(d)(3)(E) prohibits rollover of an RMD. This means that if any portion of an RMD is deposited into a Roth IRA, it is required to be treated as an ordinary Roth IRA contribution, not a Roth conversion. (The term "Roth conversion" has specific meaning in the tax code, referring to section 408A(d)(3)(C).)

Congress delegated to the IRS the authority to develop the regulations necessary to implement the statutes. CFR 1.408-8(b)(3) establishes that the first dollars out of an individual's IRAs are RMD until the RMD for the individual's traditional IRAs has been satisfied, eliminating ambiguity about which distribution is an RMD.

Re: Why must RMD be completed before doing ROTH conversion

user17717088430 — Mon, 23 Feb 2026 23:32:20 GMT

Thank you. I will assume you are correct, but without digging too deeply: The first reference to 408A(d)(3) that defines a Roth rollover as a taxable conversion is irrelevant, as taxes are due on all Roth conversions from a traditional IRA, whether as a result of an RMD or for any other reason. That would include funds rolled over that originated as an RMD. Section 403A(d)(3)(E) refers to "Special rules for contributions to which 2-year averaging applies." It does not expressly reference RMDs at all, and insofar as I am aware, RMDs are not "contributions to which two year averaging applies". Perhaps you intended to refer to a different statute.

Re: Why must RMD be completed before doing ROTH conversion

dmertz — Tue, 24 Feb 2026 01:32:36 GMT

@user17717088430 , I referred to section 408(d)(3)(E) which prohibits rollovers of RMDs, not 408A(d)(3)(E).

Re: Why must RMD be completed before doing ROTH conversion

jestefan — Thu, 26 Mar 2026 17:50:53 GMT

Can you please cite the IRS publication or better yet U.S. Code that states this? I cannot find either. Thank you.

Re: Why must RMD be completed before doing ROTH conversion

DaveF1006 — Thu, 26 Mar 2026 19:59:42 GMT

A Roth conversion is legally defined as a "qualified rollover contribution." Under the tax code, you cannot "roll over" any money that is classified as a Required Minimum Distribution. Here are some references that may pertain to you.

The Citation: 26 U.S. Code § 408(d)(3)(E)
What it says: "Denial of rollover treatment for required distributions." It explicitly states that the rollover rules do not apply to any amount required to be distributed under section 401(a)(9) (the RMD rules).
The Logic: Since a Roth conversion is a rollover, and RMDs cannot be rolled over, an RMD cannot be converted.

2. The Treasury Regulation: The "First Dollars Out" Rule

This is the "gotcha" that forces the timing. The IRS has a regulation stating that if you are of RMD age, the very first money you take out of your IRA in a calendar year is legally deemed to be your RMD until that requirement is satisfied.
The Citation: 26 CFR § 1.408-8, Q&A-4 (specifically paragraph (a))
What it says: "The first dollars distributed during that year are treated as consisting of the required minimum distribution until an amount equal to the [RMD]... has been distributed."
The Logic: You cannot "skip over" the RMD to convert other funds first. Any attempt to convert money before taking your RMD results in the IRS viewing that "conversion" as actually being your RMD.

3. IRS Publication 590-A

For a plain-English explanation, the IRS clarifies this in their annual guide for taxpayers.

The Citation: IRS Publication 590-A, under the section "Can you move retirement plan assets?" and the sub-header "Required distributions."
What it says: "You cannot make a tax-free rollover of a required minimum distribution... Any amount converted to a Roth IRA is treated as a distribution from your traditional IRA and a rollover to the Roth IRA."

@jestefan