Roth IRA Opportunity
The Tax Increase Prevention and Reconciliation Act included a provision dealing with conversions of traditional IRAs to Roth IRAs. In 2010, the existing $100,000 income test for converting a traditional IRA to a Roth IRA will no longer apply. Conversions that occur in 2010 will be able to have half of the taxable converted amount taxed in 2011 and the other half taxed in 2012.
This is a tremendous planning opportunity for those taxpayers who are currently not eligible to contribute to or to convert to a Roth IRA. Roth IRAs offer many advantages over Traditional IRAs including potential tax free growth for you and your beneficiary over your respective lifetimes.