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Gold Roth IRA Rules | Converting Roth IRA To Gold | Rollover IRA To Gold Investment - YouTube
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hey this is Jeff rose welcome again to
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goodfinancialcents.com today I want to
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talk a little bit more about the Roth
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IRA conversion now if you bend by the
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blog you've probably seen that I've
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written numerous articles talking about
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the Roth IRA conversion for 2010 there
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was a lot of hoopla about it so I want
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to make sure that my readers of my
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clients all knew or someone knew it see
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if that actually made sense for them the
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big questions going forward are is it
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still available can you still do it
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what's the tax treatment and does it
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make sense and that's what I want to
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talk about today to see if some of those
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things apply to you regarding the Roth
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IRA conversion first number one can you
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still do it yes you sure can
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prior to 2010 there was $100,000
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adjusted gross income limit as far as
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those who could actually couldn't do the
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conversion so that means if you've made
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more than a hundred thousand dollars per
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year you were on the outside looking in
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couldn't partake in 2010 they lifted
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those limits to where basically anyone
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the brother can now do the Roth IRA
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conversion what also made 2010 a little
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bit more special is that the IRS will
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allow a special tax treatment to where
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you could defer the tax payment over a
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three year period going forward that is
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no longer the case so please keep that
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in mind in 2011 you can still do the
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conversion but any tax that is owed is
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due in that year in that year
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specifically so you cannot defer for a
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two or three year stretch what does that
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mean exactly that means whenever you
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convert come April 15th of the following
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year when extra you file your taxes
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that's when you pay the tax on the on
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the conversion amount another question I
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did is what exactly what is the tax I
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pay or how does that work exactly or or
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what is my basis from the conversion
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because they know I've been investing in
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my IRA for fifteen years how do I know
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the conversion or excuse me the tax
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calculation is actually pretty simple
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your new baby
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this becomes the amount that you
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actually convert so it doesn't matter
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how much you invested 15 years ago
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what matters is what is the value today
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of the IRA when you convert so let's say
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that you invested $10,000 inside the top
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IRA it's now worth $45,000 the day that
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you convert if it's worth $45,000 that's
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how much you would add is income for the
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year you convert and that will then
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determine what tax bracket you fall
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under and how much the appropriate tax
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will be pretty simple but is still I
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would strongly suggest you know meeting
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with a tax professional we're sitting
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down with your financial advisor just to
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make sure that you're clear and
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everyone's clear on what the tax
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consequence is for you and also just see
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if it makes sense
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what another common question I did is
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how do I figure you know I've got all
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these IRAs and 401ks if I only want to
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convert some how does that work remember
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if you have an IRA at a brokerage firm
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if you have IRA in a bank if you have
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IRA spread out everywhere
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the IRS looks at all your IRAs as a 1 so
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if you're only trying to convert a small
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portion of that that's ok but the big
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big factor that comes into play is if
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you have non-deductible IRAs meaning
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that if you were if you contributed to
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traditional IRAs after tax that you
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didn't get that tax deduction the IRS is
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not gonna just let you convert the
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non-deductible higher raise you're gonna
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have to pay some type of prorated tax on
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that amount that I would like confessed
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does get a little bit confusing if you
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go to the blog in a search Roth IRA
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conversion tax rules I've got an article
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that kind of outlines a couple different
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scenarios that can walk you through to
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see how much you have to pay with those
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taxes one last point on as far as the
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the IRS and how that view is all as one
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keep in mind that the other option of
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converting up is not just IRAs but all
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401ks or any type of whole retirement
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account as far as the aggregate total
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the IRS does not look as the for
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Kait as part of that as part of that
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some so if you have some IRA is that
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maybe you don't want convert and either
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one you don't want that to be used into
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the conversion calculation if you have
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the ability to roll those IRAs into back
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into an old 401k or into your current
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401k you can do so just another little
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neat little trick that some people may
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or may not know so hopefully that's
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helpful and lastly the big question that
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I always get and I've gotten this
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probably at least a thousand times this
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past year does the Roth IRA makes sense
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for you and here's the thing it depends
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you know that is call that the cop-out
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answer but honestly it truly truly
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depends I've analyzed and analyzed
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several different clients who were
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interested in doing the Roth IRA many of
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them didn't it didn't make much sense
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for them mostly because they couldn't
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enjoy or couldn't actually allow the
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growth tax-free of the Roth to really be
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a benefit to them or also they didn't
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have the cash to pay for the tax
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out-of-pocket you know those were kind
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of like two requirements you know if
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you're actually going to do the
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conversion you want to be able to pay
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the tax out-of-pocket you don't want you
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want to pay for it out of the account
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that basically just basically defeats
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the whole purpose of doing the Roth IRA
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and conversion so there's a couple
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things to consider if you want more
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information on a Roth IRA conversion
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stop by the blog goodfinancialcents.com
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I've got tons of information there and
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also tons of information to come that if
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there's a delay latest developments on
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the Roth IRA conversion thanks for
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coming by and be sure to stop by the
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blog and check out for more information
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take care
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