401K to IRA to Roth IRA Question

[Guest DN]

I rolled a 401K (approximately $25,000) into a traditional IRA a few years back. I then converted the traditional IRA into a Roth IRA in 1998 (spreading the taxes over four years). My financial advisor says that I cannot contribute to this "conversion Roth IRA" because it originated from a 401K. Is she correct?

Thanks for your help!

[BPickerCPA]

She is NOT correct.

But I am NOT surprised.

[Guest JM Cooke]

In 1998, your advisor would have been correct, however the Roth IRA laws were ammended so that Roth conversion money and Roth contribution money can be deposited into the same account.

[Guest DN]

Thanks for your help!

[John G]

A few custodians may still be working on the '98 plan, or atleast the front desk folks may say you can not contribute. If you have a problem, contact the back office IRA dpt which is much more likely to informed/trained. There is no IRS rule or reason why you can not contribute to a conversion account.