deadline for conversion to Roth IRA, 12-31-98?

[Guest bverbout]

Is the deadline to convert to a roth from a traditional ira 12-31-98 for1998? or is it 4-15-99? I'm not concerned about the 4 year rule, but would like to do a conversion for 1998 before the 4-15-99 deadline, if possible.

[This message has been edited by bverbout (edited 04-12-99).]

[Kathy]

The deadline to CONVERT a traditional IRA to a Roth IRA for 1998 (in order to spread the tax consequences over 4 years) was 12/31/1998. You may still make 1998 Roth IRA contributions (lesser of $2,000 or your earned income) until 4/15/99 and these will start your 5 year clock for qualifed withdrawals as of 1/1/98.

If you are still interested in converting and your income is low enough, you can just convert small portions of your traditional IRA each year, thereby spreading the tax consequences out a little bit. Also, I think there is legislation pending which will increase or eliminate the $100,000 limit on MAGI for eligibility to convert - watch for updates on that.

[John G]

Deadline for 1998 conversions is past, regardless of what option you might wanted to take for taxes.

Conversions are still possible for the 1999 year with the same rules as before (some legislation is proposed). A 1999 conversion must be completed by Dec 31 this year, and at this time the same income thresholds apply. Don't wait until year end to get the paperwork done as many institutions have earlier cutoff dates... and it is up to you to make sure it is not just done, but done correctly.

[Guest eastax]

On 12/30/98, I mailed out Roth IRA conversion forms to several mutual fund companies for several clients. All companies except Franklin Templeton did not convert the IRA as a 1998 conversion. They made it a 1999 conversion because they did not receive the paperwork until the 1st week of January 1999. I already called Franklin and they won't change their date of conversion. The client wants to show the conversion as 1998 instead of 1999. What can I do to reflect the conversion on the 1998 tax return?