Author Topic: Mechanics of re-characterizing portion of tIRA to Roth at Interactive Brokers  (Read 871 times)


  • Handlebar Stache
  • *****
  • Posts: 1827
  • Age: 49
  • Location: Houston TX
  • Devour your prey raptors!
    • Living Universe Foundation
I'm in the beginning stages of re characterizing 20,000 from my tIRA to Roth at Interactive Brokers.  This is the initial step on my ladder which has been delayed in prior years due to some tax bracket hacking/Obamacare subsidy collection.  Other brokers may have a different procedure.  This is just FYI for those who might want to do the same.

At IB, you have to open two (2) new accounts.  One is a new traditional IRA that you transfer the funds into from the existing and funded tIRA.  You also open a Roth and re-characterize the entire new account after fund transfer.  The new (duplicate and empty) tIRA will delete itself after 90 days of no activity/no balance.  This seems like some unnecessary run around but both new accounts and transfers/banking departments confirm the two step requirement.

I wasn't able to follow through today.  When I went to add the new tIRA account, there were three options to choose from and I didn't know which one I needed.  By the time I could get help/chat back up, the system was down for maintenance.  Trying again on Monday.