Dentist Has IRA to Roth Conversion Question

For someone who has maxed out their ability to invest in tax-deductible products (i.e. 401k/profit sharing/SEP), wouldn’t it make sense to contribute money that otherwise would be invested in a taxable account to a non-deductible IRA and then immediately convert it to a ROTH? Now that the conversion income limits are gone, I would think this is an easy way to avoid taxes on the earnings going forward. You could invest $5000 for yourself and another $5000 for your spouse each year, unless they change the rules again.

Just make sure that NONE of your IRA accounts have pre-tax contributions or you WILL owe tax on a prorate portion of the $10,000 you want to roll over. People have asked me if they can do this and they’ve suggested that they’ll use a different IRA account for the non-deductible contributions and just roll that over. This CAN’T be done. You MUST consider ALL of your IRA funds when considering a rollover of just ONE account.

If you do have IRA accounts with pre-tax contributions or earnings and your employer plan allows employees to roll their pre-tax IRA monies into the employer plan, you can do that leaving ONLY the after-tax contributions within your IRA and then roll to a ROTH without a tax issue.

Make sure you run this by your CPA!

This first appeared on Dentaltown.

Send your questions to Tim Lott, CPA, CVA at

For more information or to sign up for our newsletter, please contact
Follow us on TwitterFacebook and Pinterest