Tax implication of Recharacterization once 4 year spreadinghas been se

[Guest Bob E]

What are the tax implication if you wish to recharacterize a Roth conversion IRA back to a traditional IRA after year 1 if you elected to spread your tax liability over 4 years? First, can this election be revoked? Second, can you file an amended return for year 1 to recapture the taxes paid on the first 25% of the conversion. Third, if no recapture of year 1 tax is available, what is the tax status on that 25% of the Roth soon to be IRA funds, can they be withdrown tax free in the future?

[BPickerCPA]

The answer is simple. Once the due date for the 1998 tax return has past, you CANNOT recharacterize. So you're stuck paying the tax for the next 3 years, with a roth IRA.