Dan Caplinger: Lightning Round, let’s see if I get four in a minute here. Well, that’s going to be tough.
John says, “If I make a conversion from traditional to Roth, when are the taxes due, do I have to worry about estimated tax payments?” John, it gets treated as taxable income at the moment that you make the conversion, and so you don’t owe taxes until the following April 15th, but you’re right that you might need to, there are some estimated tax payment consequences potentially, you’re going to have to take a look at that. You may qualify for the exemption that prevents you from having to go back in time and do them, but you may need to make some payments before April 15th to avoid the penalties.
Mike Myrick asks, “Can you rollover from both a SEP IRA and another IRA into a single Roth?” Yes. You don’t have to have multiple Roth accounts as the destination target for the conversion. You can combine all of those. Just keep in mind there are some ramifications for tracking purposes that you might want to keep those separate if you do the conversions at different times. But in general, no, there’s no requirement there.
Ann asks, “Any advice for somebody who wants to contribute to the Roth that exceeds the income cap. Backdoor Roth seems complicated?” Yeah, it’s complicated. But it’s not as hard as it sounds. If my little extra at the beginning made it sound hard, I apologize. It’s not that difficult, really it’s just a matter of you put the money in the one account, you wait a week, you tell them to move it to another account. It’s not that hard.