Converting to Roth from R/O IRA

My husband and I both have Traditonal IRA that we rolled over from 401K with previous employers. If we want to convert these R/O IRA to Roth IRA, could anyone explain what kind of things are advantages and disadvantages? I am concerned about tax issue by converting to Roth. Thanks!

Assuming that your MAGI is less than $100k, you can convert the Trad IRA to a Roth IRA, owing ordinary income tax on the amount(s) converted.

To help relieve some of your concerns, you can choose do several "partial" conversions over the course of several years. For example, you can convert $1000 per year until the full amount is converted. This will help ease your tax burden.

Thank you so much for your replies. I really appreciate your help!!!!

I recharacterized about $17K last year and am considering doing so with $10K-$20K again. Not only do I have a fair amount of room left in the 15% tax bracket, I anticipate a refund of $3,000 which makes it all much easier psychologically.

Happen to be reading an article on Yahoo Finance today about the "overblown" benefits of Roth - worth a read:

Article (http://finance.yahoo.com/focus-retirement/article/104023/Roth-IRAs-Good-for-You-or-Not?mod=retirement-IRA)

I'm in the same boat as runewell. A Roth is a no-brainer for me. Now I just need to screen TD Ameritrade's no-fee mutual fund list for my '08 purchases. The list is a lot longer than I had assumed. I just received my first bond payment as well, so I need to balance my Roth's overall weight.

any bozo can be quoted in the newspaper. how about this?

Mr Johnson, a long time farmer in Leeville, stated that the UFO landed just north of his barn.

people, just cause it is said, doesnt mean its true. buyer beware. and remember that the first sale you are being offered is PLEASE READ MY ARTICLE. it only makes sense for them to create controversy or concern.

quoted from the above article:

Roland Manarin, founder of Manarin Investment Counsel, in Omaha, Neb., says investors will watch their dollars grow faster in a tax-deferred account, such as a deductible IRA or a 401(k), because the tax-deferral allows savers to contribute more now than they can afford to contribute to an after-tax Roth. "To put $4,000 into a Roth, you have to effectively earn $6,000," because of taxes, Manarin said.

i think everyone will agree that if you put 4K into a Roth and you are earning 6K to do so to pay the other 2K to taxes, that means you are paying an effective tax rate of 33.3%.

i would suggest Manarin is a UFO reporting bozo. in order to be in that tax bracket a single person would have to AGI over $190K a year in income. a married couple would have to AGI over 100K so that means they are probably earning 180-190K themselves. the single person is ineligible for the Roth so Marin is wrong. Marin may be right on a few married couples in the US but clearly he is talking about a fractional share of the population .. a statisitically insignificant portion of our population.

I read that article before I saw it linked here. My first thought was the author just wanted to have something to differentiate himself from the pack. Since most everyone loves Roths, go the other way and you get yourself noticed.