1 See Institute Memorandum to Pension Members No. 18-99 and Pension Operations Advisory Committee
No. 24-99, dated April 8, 1999.
[10913]
April 19, 1999
TO: PENSION COMMITTEE No. 29-99
PENSION OPERATIONS ADVISORY COMMITTEE No. 28-99
RE: CONFERENCE CALL ON "FAILED" ROTH IRA CONVERSIONS
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The Institute has scheduled conference call for Friday, April 23 at 2:00 p.m. EST to
discuss “failed” Roth IRA conversions. Specifically, some taxpayers who converted traditional
IRAs to Roth IRAs during 1998 were ineligible to do so, because their adjusted gross income
exceeded the $100,000 limitation. These conversions give rise to several issues: (1) the extent
to which taxpayers are permitted to recharacterize the conversion; (2) the nature of tax penalties
incurred if the Roth IRA conversion is not recharacterized by tax filing deadlines; and (3) the
related reporting obligations of financial institutions.
In early April, the Internal Revenue Service issued a release stating that individuals who
converted IRAs but exceeded the $100,000 AGI limitation have until the tax filing deadline
(including extensions) to correct the conversion in a recharacterization transaction. The release
also stated that such taxpayers could file an amended return by April 15 to recharacterize their
Roth IRA conversion if they had already filed their tax return.1 We will discuss the extent to
which firms are receiving recharacterization requests and whether current IRS guidance
sufficiently addresses this matter.
To participate on this conference call, please complete the response below and fax it to
Melanie Washington by COB Thursday, April 22. If you have any questions concerning the call,
please call me at (202) 326-5835 or Kathryn Ricard at (202) 218-3563.
Russ Galer
Senior Counsel
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Attendance Form for Institute “Failed” Roth IRA Conversions Conference Call
Friday, April 22, 1999 – 2:00 EST
Please fax this form by Thursday, April 22, 1999 to Melanie Washington at (202) 326-5841. Yes,
I will participate in the Roth IRA conference call. Tot participate in the call, dial 1-800-523-5415
and ask for the “Roth IRA" call, confirmation number 1476374.
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Committee Member Firm Phone Number