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Roth conversion

Question: I understand it will be possible to convert an IRA to a Roth IRA without penalty in 2010. Will it be possible to convert any part of the 403b, into which I continue to contribute, to a Roth IRA? Tom, Rochester, NY

Answer: Some older employees will have the opportunity to convert part or their entire employer-sponsored retirement savings plan into a Roth. If you are over 59½ and still working at your company, you can withdraw the money in your employer's 401(k) plan, 403(b), and the like without penalty and place it in a Roth. However, your company's pension-plan documentation must allow for such an "in-service" distribution (while you're still employed).

Of course, that's only the first hurdle. You still have to figure out whether conversion from an employer-sponsored plan into a Roth is a smart move. By the way, the best Roth conversion calculator I've come across was recently created by Henry Hebeler at analyzenow.com. Check it out.

About the author

Chris Farrell is the economics editor of Marketplace Money.

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