Congratulations to Nick M., this month’s Study Question of the Month winner! (Nick M. is no relation to last month’s winner.)
See the answer below!
This month’s study question from the Solomon Online Exam Simulator question database is now available!
***Submit your answer to email@example.com to be entered to win a $10 Starbucks gift card.***
A single 41-year old who earns $200,000 per year wants to convert his traditional IRA to a Roth IRA. Which of the following is the best answer?
A. He may not convert because his income exceeds the limit permitted for such conversions.
B. He may convert up to $5,500 per year.
C. He may not convert because he younger than 50.
D. He may convert without restrictions.
Answer: D. If your modified adjusted gross income is greater than $133,000 (single filer) or $194,000 (married filing jointly), then you may not contribute to a Roth IRA. However, there are no income or age restrictions on converting funds from a traditional IRA to a Roth IRA. A conversion from a traditional IRA to a Roth IRA is not counted as a “rollover” under the one per year rollover rule.