Question ? The annual ( RMD ) from a traditional IRA is a taxable event.

Submitted by Joseph Scanlan on Fri, 2020-07-31 19:50

Is it possible to receive a payment from a traditional ira and reinvest that amount back into a roth ira with out owning taxable income ?

Permalink Submitted by Alan - IRA critic on Fri, 2020-07-31 20:03

You cannot convert or roll over the amount of the RMD. You must complete the RMD first, then take an additional distribution for the conversion. Both will be taxable as follows.
You are referring to an indirect (60 day rollover) conversion after you otherwise completed your RMD. This is taxable in the same amount as if you did not convert. The entire RMD distribution and additional conversion will be taxable except to the extent you have basis in your IRA. IRA basis results when you made non deductible contributions (if any) and documented them on Form 8606 for the year of the contribution. When you then take a distribution this IRA basis is pro rated against the value of all your non Roth iRA accounts. For example, if your total value is 100k and 15k of that was from non deductible contributions, then an RMD or conversion of any amount will result in 85% being taxable and 15% being non taxable. Therefore, the only way such a conversion would be totally tax free is when your entire TIRA value is from non deductible contributions and there are no investment gains.