Question

1.What are the basic financial requirements before you roll over your IRA into a ROTH IRA?

2.If the beneficiary to an IRA is not a spouse, upon death of the account owner, when do distribution begin and on what do they base the life expenctancy for determining annual distribution?

Answer 1

1. The basic financial requirements before you rollover your IRA into a Roth IRA are as follows:

• There is an income limits on Roth participants, usually the high income group benifits from the rollover of IRA into Roth IRA.
• Roth Participants has to owe taxes in the next year on the fund transfer from IRA to Roth IRA as Roth IRA contributions are to be made with after tax dollars.

2.Non-spouse beneficiary must withdraw all inhereted IRA funds within the 10 years of death of the original account holder. Non-beneficiary IRA are not eligible to roll the inherited IRA into their own name, nor they can contribute to it. There is no early withdrawal penalty paid by the beneficiary, but must pay the income tax on the withdrawal amount of inhereted IRA. Distribution must begin no later than 31 December of the year after death under life expectancy method.