TD Ameritrade

Our thoughts are with those impacted by the California Wildfires

If you need help, or to find out whether your local branch is open, please call us anytime at 800-669-3900. If you’d like to lend a hand, please donate to the American Red Cross at our TD Ameritrade Disaster Relief Donation site.

Roth IRA Conversions

Convert a Traditional IRA to a Roth IRA that offers tax-deferred growth and potentially tax-free withdrawals once you reach retirement.

Benefits of a Roth IRA

  • Withdrawals of earnings are free from federal income tax, provided the Roth IRA has been in existence for five years and you are at least 59½.
  • Contributions can be withdrawn anytime without federal income taxes or penalties.
  • RMDs (Required Minimum Distribution) are not required.
  • Distributions for your beneficiaries are tax-free.

Eligibility Requirements

Effective January 1, 2010, you can convert a Traditional IRA to a Roth IRA regardless of your income level. Prior to 2010, individuals or couples with modified adjusted gross income in excess of $100,000 were ineligible to convert retirement savings to a Roth IRA.

Cost of Converting

When you convert to a Roth IRA, you must pay income tax on the otherwise taxable amount of the transfer. To maximize the benefits of conversion, the money to pay those taxes should come from a source outside the Traditional IRA you are converting. You may convert your Traditional IRA over several years to manage the tax consequences.

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