Texas is my state
I've tried to understand the conversion of my Traditional IRA to a ROTH IRA , but I cannot get a clear understanding of how to treat the conversion amounts, and how such amounts affect my AGI.
I know that if I take a distribution from my traditional IRA, and keep it, then I must include the amount in my AGI for income tax purposes.
However, if I convert my traditional IRA into a ROTH IRA, it's not clear to me what happens to my AGI when the conversion is completed. On the one hand, there appears to be an AGI max limit that can't be exceeded, and still be able to make the conversion to a ROTH, ie max AGI is $100,000. But I have seen another reference that says for conversion purposes I do not consider the conversion amount as part of my AGI computation to determine whether I exceed the limit and would be thereby prohibited from making such a conversion. This would suggest to me that for conversion purposes, the AGI limit computation considers all other received income, and does not include the conversion amount. Is this a correct interpretation? Can anyone address this AGI impact?