How To Guide For: Converting To A Roth IRA -- What You Need To Know

Before you convert to a Roth IRA lets define what a Roth IRA is. A Roth IRA is an individual retirement account allowing a person to set aside after-tax income up to a specified amount each year. Both earnings on the account and withdrawals after age 59½ are tax-free. So now that we've defined a Roth IRA lets look at how to convert to a Roth IRA. When you convert from a Traditional IRA to a Roth IRA you pay income tax on the contributions. The taxable amount that is converted is added to your income taxes and your regular income rate is applied to your total income. When deciding to convert to a Roth IRA you need to make sure that this is the best retirement choice for you first before you make any changes. To get more in depth information on converting to a Roth IRA and what you need to know click on the pictures below to read the articles.