Having a child in the 1st year of college, I was thrilled to learn of the $1500 Hope Scholarship tax credit. I was also thrilled with the thoughts of tax free retirement money so I converted my Traditional over to a Roth without realizing I was pushing our combined taxable income over the Hope limit even if I spread out the IRA distribution over the four year period. Is there anyway around this short of recharacterizing the Roth IRA back to Traditional status? I can't believe this is happening!

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Chuck W

Yes, you lose your eligibility for the credit.

This is one of the things frequently overlooked by folks when blinded by the wonders of a Roth conversion . . .

As always, you need to run *all* the numbers before making the Roth leap.