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FIdelity Roth Conversion Online Process is Simple

For those of you who haven't done it, it's pretty simple. Open a Roth, if you didn't already have one at Fidelity. Fund it with a transfer from your IRA. They ask if you have already met your RMD obligation this year. If you have, it's categorized as a Roth conversion and you get the letter the next day.

If you do not want money withheld for taxes, it's online. If you want taxes taken out, you have to call Fidelity, I assume that's so one of their tax guys will tell you (a)  it's probably  better to take the taxes out of your taxable account, and (b) pay the estimated taxes next January 15, so your money can stay invested til then.

Another feature I didn't see when I took my RMD last year is that I can move individual holdings (in part or partially) in the IRA to the Roth. I moved cash, but then realized I should have just moved part of my S&P index fund. Now I have to repurchase it.

With the suspension of this year's RMD, I decided to do a small Roth conversion, mindful of the tax bracket headroom and medicare tiers. My tax bracket can only get higher. Might as well take the pain now,



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Frequent Contributor

Re: FIdelity Roth Conversion Online Process is Simple

The online process of Roth conversion is simple at Vanguard too. VG allows fed tax withholding option.

I take RMDs as regular withdrawals as the first withdrawals are assumed to be RMDs. If one indicates RMDs, then more complicated screens are seen. Unfortunately, I took then in early January and the law so far allows putting them back only if taken after 2/1/20; may be this will change later.

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