Roth IRA Conversions Delay Tax-Free Growth Until Age 59½

A 64-year-old converting $100,000 from a traditional IRA to a Roth IRA must wait five years for tax-free earnings withdrawal. Even after reaching 59½, withdrawals are taxable if the five-year qualification clock hasn't completed. The five-year clock starts on January 1 of the year of conversion and applies to both the original contribution and any future conversions. This matters for investors considering Roth IRAs, as understanding these rules can impact tax outcomes significantly.

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