Guidant Financial Group Blog

We recently received a request to respond to a blog comment on Roth conversions within Guidant’s IRA/LLC structure. We thought this was a very good question to forward on to our general readership as well.

As of January 2010, Roth conversion requirements have been relaxed and the tax implications have been lessened. Because of this, many prospective and current clients are asking the question, “How can I convert to a Roth?”

If you are a prospective client, please call your existing administrator or Guidant to talk about your options. If you are an existing client, however, we are sure that you will find the information below very useful:

QUESTION: How does a Roth Conversion work with a Guidant IRA/LLC?

ANSWER: This is an excellent question, and one we receive often. If you currently have a Guidant IRA/LLC and wish to convert the traditional IRA component of that to a Roth IRA there are a few steps that will need to be taken.

The most important part of this process is the appraisal of any assets your IRA/LLC currently holds. It is extremely important to get an independent, written, third-party appraisal for any non-publicly traded assets, such as real estate. You should avoid any temptation to cut corners on this valuation – this is no time to try short cuts such as “windshield appraisals” by friendly realtors, etc. As this is the last opportunity the IRS has to collect taxes on this retirement account, they are going to be extra sure that they are collecting all owed taxes on this conversion.

The next part of this process is contacting your current IRA/LLC custodian to obtain their Roth conversion paperwork. This paperwork will create a new Roth IRA at your current custodian. In conjunction with filling out these documents, you should get in touch with Guidant to prepare a board resolution, by which the members of your LLC approve the conversion of the Traditional IRA to a Roth IRA. We will also provide you with further instructions on voiding current and creating new LLC members units certificates.

Once your custodian has accepted the new account paperwork, and Guidant has worked with you to complete the necessary changes to any LLC documents, your custodian will then complete the conversion by moving the assets (the units, as well as any cash in the account) to the Roth Conversion account. After this transfer is complete, the traditional IRA account is generally shut down.

We know that this sounds like a lot – but just as we provided you with all the assistance you needed to set up your IRA/LLC account to start, we will help walk you through this conversion process. Please feel free to contact us anytime!

Our IRA/LLC support team can be contacted directly at: 888.472.4455 x3311