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    rarkema's Avatar
    rarkema Posts: 1, Reputation: 1
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    #1

    Mar 10, 2012, 02:11 PM
    10% penalty when you pay your taxes from IRA during Roth IRA conversion?
    If you are using money of an IRA to pay taxes during roth ira conversion, are the amounts taken out to pay taxes subject to the 10% early withdrawal penalty?
    newacct's Avatar
    newacct Posts: 321, Reputation: 21
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    #2

    Mar 10, 2012, 10:55 PM
    Yes.

    You must normally pay taxes on a conversion out of pocket. If you use the IRA money to do it, then that is equivalent to taking a distribution from the IRA and using that to pay taxes for the conversion of the remainder. The distribution is subject to penalty like any other distribution.
    chat8102's Avatar
    chat8102 Posts: 7, Reputation: 1
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    #3

    Apr 5, 2012, 11:30 AM
    Deleted a wrong post
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