Cost Basis for IRA's in Roth Conversion

I am thinking about converting my traditional IRA's into Roth's in 2010. If I know the overall cost basis for ALL my traditional IRA's combined, but not the cost basis for mutiple individual mutual fund IRA's, do I have to combine all my IRA's into one account in order to calculate the taxes due?

Dmdmark,

It is good that you have been contributing to your IRA.

It sounds like your TIRAs have after tax (basis) contributions.
Yes, you must look at all of your TIRAs as one TIRA.

Part of your Conversions will be after tax contributions, and part of the Conversions will be pre-tax contributions and/or gains. The ratio of the 2 in your total TIRA will be applied to your Conversion amount to determine the taxable amount of the Conversion.
Use Form 8606 to determine the taxable amount.

Your 2010 Conversion will be split equally between your 2011 and 2012 tax years. You will pay the applicalble tax rate in each of those years. Or you can Opt out of the split, and pay the tax in 2010. If your spouse is converting to a ROTH IRA, they may choose to pay the tax using the 2 year option or pay the tax in 2010.

Clydewolf,

Thanks for your reply. You have always been very gracious about answering questions. A followup question. Since we file a joint return, do we have to combine both our TIRA assets (non deduct & deduct) when converting to a Roth? Thanks

Dmdmark,

You do not combine the TIRA accounts of both taxpayers. Remember, Individual Retirement Arrangements, are not joint accounts, they are Individual accounts.

When you do your ROTH Conversion, you complete Your form 8606.
When your spouse does their ROTH Conversion, they complete Their form 8606.
Both of you can convert in the same year. Remember the Conversion amounts are not part of the Modified Adjusted Gross Income. For 2009, your MAGI can not exceed $100,000. That MAGI limit goes away January 1, 2010.

When you do convert to a ROTH IRA, put the Conversion into a new ROTH IRA account. If you later decide to Recharacterize your ROTH Conversion, this will make the Recharacterization much easier. You have until October 15 of the year after the Conversion to Recharacterize.