Roth IRA Conversions

What is a Roth conversion?

A Roth conversion (also known as a backdoor Roth) involves transferring assets from a Traditional (Pre-Tax) IRA to a Roth (Post-Tax) IRA. This allows future qualified distributions and investment growth to occur tax-free. There are no IRS limits on the number or dollar amount of conversions per year. For more on IRA rules, visit irs.gov.

How do I start the Roth conversion process?

To begin a Roth conversion, you will need both a Roth IRA and a funded Traditional or Rollover IRA. During this process, you will be able to adjust your tax withholding amount and choose whether to close the source account. You can initiate the conversion through either the mobile app or website by following the instructions below:

App:

1. Tap Account at the bottom center.
2. Select your Traditional/Rollover IRA.
3. Tap Transfers at the top of the screen.
4. Select Roth Conversions.

Lite Mode:

1. Select the Plan page (target icon).
2. Tap IRA Tools.
3. Select Start a Roth Conversion.

Website:

1. Select My Account.
2. On the left side column, expand the Transfer Money tab.
3. Select Roth Conversions.

How long does the process take?

Roth IRA conversions, when received in good order, are typically processed within 1-5 business days.

What else should I know?

When considering a Roth IRA conversion, please note:

• Roth conversions cannot be reversed or recharacterized back to a Traditional IRA.
• In-kind conversions are not supported; only cash conversions are allowed.
• Form 1099-R will be issued for the Traditional IRA to report the distribution.
• Form 5498 will be issued for the Roth IRA to report the contribution.

Webull Financial does not offer tax advice. Any integration with third-party tax software is provided for informational purposes only. For any questions about taxes, including how to file, you should contact a tax professional.