By Sarah Brenner, JD
Director of Retirement Education
Question:
Hello Ed Slott Team!
I have been doing backdoor Roth IRA conversions for years now. I recently inherited a large traditional IRA from my aunt. Will the inherited IRA affect my ability to do tax-free backdoor Roth IRA conversions?
Answer:
Good news! You can continue to do backdoor Roth IRA conversions without a tax bill. You may be concerned about the pro rata formula that applies when these transactions are done. This is not an issue in your situation. That is because inherited IRAs are not included with your own IRAs when using the pro rata formula.
Question:
Good afternoon! I enjoy reading your content and appreciate your IRA expertise. I was just reading this month’s piece on qualified charitable distributions (QCDs). While you mentioned traditional IRAs, a QCD can be distributed from an inherited IRA, right?
Regards,
John
Answer:
Hi John,
Thanks for the kind words! You are correct. A QCD can be done from an inherited IRA, as long as the beneficiary of the IRA is age 70½ or older.
If you have technical questions you would like to have answered, be sure to submit them to mailbag@irahelp.com, to be answered on an upcoming Slott Report Mailbag, published every Thursday.
https://irahelp.com/roth-conversions-and-qualified-charitable-distributions-todays-slott-report-mailbag-3/