Only an IRA inherited from your former spouse can be converted to a Roth IRA. IRAs inherited from anyone else can't be converted.
Example: You inherit a Roth IRA that was established two years earlier. The Roth IRA includes $96,000 from a rollover contribution and $4,000 of earnings. You can immediately withdraw the entire $100,000 and pay tax (but no penalty) on the $4,000 of earnings.  If your clients' income exceeds the Roth contribution income eligibility limits and they want that $5,000 (or $6,000) in a Roth, they can easily bypass those limits by first contributing the funds to traditional IRAs (if they are under 701/2 and have earned income) and then converting those funds to Roth IRAs. Starting in 2010, any non-spouse beneficiary who inherits a qualified plan is eligible to convert that plan to an inherited Roth IRA, and the plan must allow this transfer. Before 2010, the plan did not have to allow the transfer, even though the law allowed the post-death conversion. Though death did part you and your spouse, the benefits of your marriage continue to live on in one financial way. Only an IRA inherited from your former spouse can be converted to a Roth IRA. IRAs inherited from anyone else can't be converted. Any IRA passed on to you from a spouse becomes yours to keep or convert as you please. For example, if you have $40,000 in wages for the year and take out $5,000 from the inherited IRA, you can put that $5,000 into a Roth IRA if you haven't already made your IRA contribution for the year. Tax Reporting. The amount you convert from the inherited IRA to a Roth counts as taxable income. This makes such a conversion a good idea when you're in a lower income tax bracket as opposed to the future when distributions push you into a higher bracket. For example, if you have $40,000 in wages for the year and take out $5,000 from the inherited IRA, you can put that $5,000 into a Roth IRA if you haven't already made your IRA contribution for the year. No. Inherited IRAs, on the other hand, cannot be converted to inherited Roth IRAs. Only the IRA owner (the person who made the IRA contributions) can do the conversion. Spouses. A spouse can always move the funds inherited from the deceased spouse to his or her own IRA and then do a conversion to a Roth IRA. Inherited employer plan assets (401(k), etc.) can be directly transferred to a properly titled, inherited Roth IRA. Income tax will be due on the amount converted and must be paid by the beneficiary doing Roth IRA Conversion Taxes. When you convert from a Traditional IRA to a Roth IRA you pay income tax on the contributions. The taxable amount that is converted is added to your income taxes and your regular income rate is applied to your total income. Although the Roth IRA conversion limits have been repealed, the Roth contribution limits are still in effect. The phaseout income limits for a 2010 Roth IRA contribution are $167,000 to $177,000 for married-joint filers and $105,000 to $120,000 for individuals. Starting in 2010, any non-spouse beneficiary who inherits a qualified plan is eligible to convert that plan to an inherited Roth IRA, and the plan must allow this transfer. Before 2010, the plan did not have to allow the transfer, even though the law allowed the post-death conversion. However, you will need to pay taxes on the amount converted from the non-Roth IRA into the Roth IRA. Converting your inherited assets to a Roth IRA is more likely to be advantageous if you expect higher taxes in retirement and you can afford to pay the taxes with funds from other sources. When you inherit your spouse's IRA or 401(k) directly, you have the option of converting it into a Roth IRA in your name. Roth IRAs have many benefits, including the potential for tax-free growth of assets and no MRDs during the lifetime of the original owner. Just like a regular conversion, moving money from a non-Roth IRA to a Roth will require you to pay taxes on the amount converted—that could be a big hit with a large account. If a Roth isn’t for you, choosing between a traditional and inherited IRA depends largely on your age and your immediate financial needs. A spouse who inherits an IRA can either move the money into a new or existing traditional or Roth IRA in their name or put it into an inherited IRA (an inherited account can also be “disclaimed” for estate planning purposes —talk to an attorney if you want to leave the money to your heirs).
http://fairmark.com/retirement/roth-accounts/roth-distributions/inherited-roth-ira/ http://www.investmentnews.com/article/20100404/REG/304049987/what-cant-be-converted-to-a-roth http://budgeting.thenest.com/convert-inherited-ira-roth-21132.html http://budgeting.thenest.com/convert-inherited-ira-roth-21132.html https://www.irahelp.com/slottreport/converting-inherited-assets-roth-ira http://www.rothira.com/roth-ira-conversion-rules http://www.investmentnews.com/article/20100404/REG/304049987/what-cant-be-converted-to-a-roth https://www.fidelity.com/retirement-ira/inherited-ira/learn-about-your-choices http://www.rothira.com/inherited-iras
can an inherited ira be converted to a roth ira