What are the benefits of a Roth IRA conversion?

While everyone's tax situation is unique and it's important to spend some time with your tax advisor to make sure you understand your situation clearly, the possible benefits of converting a Traditional IRA to a Roth IRA are:

  • No federal income tax on your withdrawals (aka "Distributions") if you are at least 59.5 years old (and have had your IRA for at least 5 years) by the time you start making withdrawals.
  • Watch your money grow tax-free indefinitely because you won't have to take required minimum distributions (RMDs) during your lifetime.
  • Leave the Roth IRA as a tax-free bequest for your heirs. Your heirs will have to take annual RMDs, but they won't have to pay any federal income tax on those withdrawals as long as the account's been open for at least 5 years.

Axos Invest is not a tax advisor and this should not be construed as tax advice. Please consult your tax advisor before making any tax-related decisions.

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