Converting IRAs tax free?


Q: This is regarding the following question and answer — Q. If I have a traditional IRA worth $100,000 with a basis (post-tax contributions) of $20,000; can I roll over $80,000 to the Thrift Savings Plan and the other convert the other $20,000 to a Roth? Would these two actions result in a tax-free transaction? A. Yes, a special rule allows for this to be done. — is this your final answer? Please tell us what the special rule is. And if this is the final answer, can a retiree do this? I would contribute my pre-tax earnings in my traditional IRA to TSP and then I would roll the basis to the Roth.

A: You’ll find the information you’re looking for on Page 23 of IRS Publication 590. If you’re not sure about how to proceed, you should consult a tax adviser about your specific situation.


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Mike Miles is a Certified Financial Planner licensee and principal adviser for Variplan LLC, an independent fiduciary in Vienna, Virginia. Email your financial questions to and view his blog at

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