IRA Rollover and Recharactization

If you are doing an Roth IRA conversion, where you are taking money from a traditional or rollover IRA to a Roth IRA, heed this advice. Open a new Roth account and then rollover the stocks. This will save you a bunch of headache in case you need to do a recharactization (undo the rollover by moving the Roth IRA back to traditional or rollover IRA).

Using a new Roth IRA when recharacterizing makes the conversion easier because then you don’t have to worry about any calculations like calculating the earnings.

Leave a Reply