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Respondent determined deficiencies in petitioners’ Federal
income taxes as shown below:
Docket No. Year Deficiency
13170-00S 1998 $1,133
3727-02S 1999 2,674
After a concession by respondent,2 the sole issue for
decision is whether the amount of income resulting from
petitioners’ conversion of their traditional Individual
Retirement Accounts (IRA) to Roth IRAs (conversion income) is an
item of income for purposes of calculating whether petitioners’
Social Security benefits are taxable. We hold that it is.
Background
Most of the facts were stipulated, and they are so found.
Petitioners resided in Howard, Ohio, at the time that their
petitions were filed with the Court.
A. Petitioners’ IRA Conversions
In 1998, petitioner Robert L. Helm converted his traditional
IRA with Fidelity Mutual to a Roth IRA with the same trustee.
The total amount converted was $59,758. In addition, petitioner
Sara J. Helm converted her traditional IRA with Fidelity Mutual
to a Roth IRA with the same trustee in 1998. The total amount
converted was $25,872.90.
2 For 1998, respondent concedes that petitioners received
$980 of interest income rather than the greater amount reported
by them on their return for that year.
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