Can I Roll Over to Roth Ira Previous Year

Benefits of a Roth IRA conversion

Tax considerations — Contributions to a Roth IRA can grow federally tax-free,
potentially increasing the value of your after-tax assets.

Flexible withdrawals — Eliminate paying federal income taxes on qualified withdrawals.Footnote ²

No income requirements — With income restrictions for IRA conversions lifted indefinitely,
anyone is eligible to convert to a Roth IRA.

Tax-free legacy — Not having to take RMDs means you can leave federally tax-free money to your heirs (and possibly state tax free).

Wide range of investment choices — Choose from a selection of stocks, bonds,
ETFs and mutual funds, often a broader choice than offered in employer-sponsored plans.

Important Considerations

Converting to a Roth IRA may not be ideal for everyone. Factors to consider include time, cost, projected tax liability and your overall financial goals and retirement income needs. To find out if a Roth IRA conversion makes sense for you, speak with a tax advisorFootnote ³ before making any decisions.

Accounts eligible for conversion to a Roth IRA

Traditional IRA
SEP IRA
SIMPLE IRA
Assets in tax-qualified retirement plans, such as 401(k)s, 403(b), 457(b)s, profit sharing and money purchase plans

Help when you need it

Required minimum distributions (RMDs)

If you are at least age 72, federal tax law requires you as the owner of a Traditional IRA or employer-sponsored retirement plan such as a 401(k) to take an RMD each year. (The required beginning date may be later for employer-sponsored retirement plans, depending on your retirement date.) In any year that an RMD is due, federal tax law considers the first distribution to contain the RMD. A Roth IRA conversion requires you to take the RMD before converting your account. Ineligible funds converted to a Roth IRA will be subject to an excise tax and will be required to be removed as excess. You should review any planned financial transactions or arrangements that may have tax or accounting implications with your personal professional advisors.

Ready to get started?

Call us for assistance and we'll guide you every step of the way. We can help you convert any of these types of accounts:

For a Traditional IRA at Bank of America or Merrill, we will help you open a Roth IRA and fill out the conversion form. Here's what you'll need
For an IRA outside of Bank of America or Merrill, we will help you transfer your Traditional IRA and assist you with the Roth IRA conversion
For assets in a 401(k) from a former employer, we will help you transfer your assets from your 401(k) and assist with the Roth IRA conversion*

Footnote

You have choices about what to do with your employer-sponsored retirement plan accounts. Depending on your financial circumstances, needs and goals, you may choose to roll over to an IRA or convert to a Roth IRA, roll over an employer-sponsored plan from your old job to your new employer, take a distribution, or leave the account where it is. Each choice may offer different investment options and services, fees and expenses, withdrawal options, required minimum distributions, tax treatment, and different types of protection from creditors and legal judgments. These are complex choices and should be considered with care. For more information on rolling over your IRA, 401(k), 403(b) or SEP IRA, visit our rollover page or call a Merrill rollover specialist at 888.637.3343.