Roth conversions

You can use a Roth conversion to convert existing retirement assets from a traditional IRA to a Roth IRA.

A Roth conversion can also be part of a backdoor strategy to get the benefits of a Roth IRA even if your income is too high to contribute directly. We recommend consulting a qualified tax professional to determine if a Roth conversion is right for you.

A conversion requires you to have a funded traditional IRA first, and then move the money into a Roth IRA. Check out IRA contributions for details about income limits for IRAs.

You need both a traditional IRA and Roth IRA opened with Robinhood and funds available to withdraw from your traditional IRA before starting a Roth conversion.

Be sure to review the Important to know section before starting a Roth conversion.

To start a Roth conversion from within your Robinhood account:

1. Open a traditional IRA with Robinhood

2. Fund your traditional IRA through a new contribution, rollover, or transfer

3. Open a Roth IRA with Robinhood

4. When the money is available (as we currently support cash-only Roth conversions), move (convert) the money from your traditional IRA to your Roth IRA by going to Retirement → Settings

5. In IRA settings → Actions, select Start a Roth conversion
6. When prompted, enter the total dollar amount, and then select Review to get to something similar to the following example

7. Confirm the details, and then select Convert

After the conversion is complete, you can then choose how to invest your Roth IRA money. Check out Retirement investing to get started.

• You may be required to pay taxes on the converted amount for the tax year in which you complete the conversion. Roth conversions are reported on your taxes for the year the conversion occurs. Keep in mind, any converted IRA Match will also be taxable.
• Generally, the converted amount or any earnings may be taxed as ordinary income, which is reported on a Form 1099-R from Robinhood. You’ll also get a Form 5498 detailing the amount converted to a Roth IRA.
• We currently support cash-only Roth conversions. Keep in mind, bank deposits can take up to 5 business days to complete. You can only convert withdrawable cash. You may need to liquidate securities into withdrawable cash in your traditional IRA before you can convert it. You may also need extra cash available for tax withholding. To request a tax withholding on your Roth conversion, you’ll need to contact us.
• It’s important to understand that Roth conversions are irrevocable, which means you can't undo the conversion afterwards. Make sure you're eligible to convert a traditional IRA to a Roth IRA before submitting your request. Robinhood is required by law to report a Roth conversion from your traditional IRA to your Roth IRA to the Internal Revenue Service (IRS) and state tax authorities.

A Roth IRA conversion will affect your taxes. Contents provided are for informational purposes only and do not constitute tax or investment advice.

This is not a recommendation of a Roth conversion. For specific questions, we recommend consulting a tax professional. A Robinhood IRA account requires first opening a Robinhood investing account.

All investments involve risk and loss of principal is possible. Investors should consider their investment objectives and risks carefully before investing.

Securities trading is offered through Robinhood Financial LLC, a registered broker-dealer and Member SIPC, and a subsidiary of Robinhood Markets, Inc. (Robinhood).