A Safer Retirement and Environment – What We’re Implementing to Help Keep You Safe: READ MORE

Here at Asset Preservation Capital, LTD, we are adhering to state and local guidelines in order to protect both the health and safety of clients and staff. Keeping our clients and staff safe is our highest priority and we’re taking all appropriate measures to ensure a safe environment. Should you prefer to not meet face-to-face, we are continuing to serve our clients through virtual settings such as Zoom or phone call.

We look forward to continuing to help individuals and families achieve their ideal retirements.

Asset Preservation Capital, LTD
(248) 649-4759

By Ian Berger, JD
IRA Analyst

Question:

Hi,

I have a client that needs funds for a short period of time, so he plans to use the 60-day rollover rule to borrow money from his IRA and return it within 60 days. He has a Traditional IRA and a Roth IRA. He is under the impression he can do a 60-day rollover for each account. My understanding is that he can only do one 60-day rollover regardless of account type during any 365-day period, so he can only take funds from his IRA or Roth, but not both. Am I correct?

Answer:

You are correct. Traditional IRA-to-traditional IRA rollovers and Roth IRA-to-Roth IRA rollovers are aggregated for purposes of the once-per-year rollover rule.

Question:

Hello Ed Slott Team,

Do dollars that hit the 1040 from a Roth conversion get discounted when calculating MAGI for a Roth contribution? Have a great day!

Answer:

Yes. Modified adjusted gross income (MAGI) is used to determine eligibility for Roth IRA contributions. MAGI is a person’s federal adjusted gross income, with certain adjustments. One of those adjustments is a subtraction of income generated by a Roth conversion. For a full list of adjustments, see “Modified Adjusted Gross Income for Roth IRA Purposes” in IRS Publication 590-A.

https://www.irahelp.com/slottreport/once-year-rollover-rule-and-income-roth-ira-contributions-today%E2%80%99s-slott-report-mailbag