This year, the year of the Roth conversion, will see an important opportunity for millions of Americans who will be permitted to convert traditional IRAs to Roth IRAs. It's a great opportunity for advisors to do new business with clients.
As Leon Labrecque, managing partner of LJPR, LLC, which manages more than $300 million in assets, notes, "Roth IRAs are more than just an excellent planning tool for retirement - they're something to help you live your life richer and happier now. There is information that the masses need to know about in order to make the best decisions for their estate planning needs."
This information is vital in making the best choice for IRA holders. "Most Roth IRA holders have been taught to the old rules, and are currently accessing their Roth based on that incorrect information," said LaBrecque.
"With turmoil in markets and the tax code in transition, the Roth IRA has some very attractive features. A Roth IRA is one of three kinds of IRAs and has a very special feature: all growth and income from a Roth are free from federal and--usually--state income taxes, if you follow the rules."
"One of the major beneficial changes in IRA rules in 2010, is that you can convert an IRA into a Roth regardless of your income level. What's even better is that if you convert an IRA to a Roth in 2010, you have the option of reporting half of the converted amount as income in 2011 and the other half in 2012," said LaBrecque.
If you have any good Roth ideas or case studies, please send them my way for publication.
