Nonmarketable investment distributions and Roth conversion

[Guest djph]

I have a nonmarketable asset in my Traditional IRA, that I would like to remove. I turn 59 1/2 in 2010. I would like to take the asset as a distribution in 2010, (I have a valuation of the asset) and then within 60 days roll cash (instead of the nonmarketable asset) into a ROTH Conversion account. Is anyone aware if this is permissible?

[mbozek]

I have a nonmarketable asset in my Traditional IRA, that I would like to remove. I turn 59 1/2 in 2010. I would like to take the asset as a distribution in 2010, (I have a valuation of the asset) and then within 60 days roll cash (instead of the nonmarketable asset) into a ROTH Conversion account. Is anyone aware if this is permissible?

not allowed. See Rev Rul 87-77. Only the property distributed can be rolled over to an IRA.

[J Simmons]

I have a nonmarketable asset in my Traditional IRA, that I would like to remove. I turn 59 1/2 in 2010. I would like to take the asset as a distribution in 2010, (I have a valuation of the asset) and then within 60 days roll cash (instead of the nonmarketable asset) into a ROTH Conversion account. Is anyone aware if this is permissible?

Just curious, what advantage are you aiming for by replacing the nonmarketable asset with cash in the IRA (if you could--mjb points out that you cannot)?

[masteff]

Question for the board at large: would a private letter ruling be an option in this case? (of course the asset in question would need to be large enough to justify the cost of submitting one)