If I have a tax-deferred 401(k). Can I convert it to a Roth IRA without paying the deferred taxes when I roll it over? -Tommy Generally, the answer here is no. There’s typically no method to totally dodge taxes on a Roth conversion. Eventually, Uncle Sam will come to collect on your tax-deferred retirement accounts – either when you execute a Roth conversion, withdraw funds or collect your required minimum distributions (RMDs). That said, your inability to totally dodge taxes doesn’t translate to an inab ...

Inheritance planning : Heirs who inherit Roth IRAs can potentially stretch out tax-free distributions over their life expectancy, depending on their relation to the person who died. However, some beneficiaries will be required to empty the account within 10 years.Tax savings : Paying conversion taxes now can make sense if you expect to be in a higher tax bracket in retirement. Roth conversions lock in today’s rates. They also reduce future RMD amounts that could push you into a higher bracket.Avoid RMDs : T ...