I have recently become self employed and rolled over my previous employers 401K account into a Self Directed Traditional IRA. As of a few days ago, I have requested and received a distribution check from my IRA with which I intend to pay off all my credit card debt. My question is should I take the money I withdrew from my IRA and open a ROTH IRA with this money, then take the distribution from the ROTH and not have to pay the 10% early withdrawl penalty, since I am only 51, realizing that I still have to pay the 28% income tax next year on the Roth distribution?

------------------
Jim

Recent legislation (IRS Restructuring & Reform Act of 1998) indicated that Roth distributions are now subject to early distribution penalty if distributed within 5 years.

You might do a search elsewhere at this website to review the details of this.

[This message has been edited by Ervin Barham (edited 04-23-99).]