Can I Access Roth Funds Immediately After Converting $900k to Avoid RMDs?

Core Insights - The article discusses the complexities of the five-year rules associated with Roth IRAs, highlighting that there are three distinct five-year rules that apply to different scenarios [2][4]. Group 1: Roth Contributions - The first five-year rule pertains to Roth contributions, requiring individuals to wait five years from the initial funding of a Roth account before taking distributions from any Roth portfolio. This rule is a one-time requirement and does not reset for future contributions [6]. Group 2: Roth Conversions - The second five-year rule applies to Roth conversions, which involves assets transferred from a pre-tax portfolio. Individuals must wait five years after making a conversion before taking distributions from the converted funds. This rule is independent for each conversion, with the five-year period starting on January 1 of the year the conversion is made [7][8]. - Notably, this rule does not apply to individuals aged 59 ½ and older, allowing them to access converted funds without the five-year waiting period [7]. Group 3: Roth Inheritance - The third five-year rule relates to Roth inheritance, where beneficiaries may be required to withdraw all assets within five years of the original owner's death, depending on their beneficiary status. This aspect is mentioned but is beyond the scope of the article [9].