IRA Conversion for Minor

From: "mike morehouse" <mikemore@hotmail.com>
Subject: IRA Conversion for Minor
Date: Mon, 11 May 1998 13:47:41 PDT

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I really need some feedback with this one. i posted it several
weeks ago 
but received no feedback. I'd sure appreciate some help.

On 4/15/98 I opened an IRA for tax year 1997 for my 19 year old
son with 
a 2000 lump sum amount. I opened a traditional IRA with
Vanguard.  I 
would have opened a Roth but for tax saving reasons for him - we
opened 
a traditional.  He has a part time job while he is in college.

It has occurred to me that it might be wise of me to now convert
that 
IRA to a Roth since I am allowed to pay the taxes over a 4 year
period. 
When I run the numbers comparing a traditional against a Roth
with all 
my sons years to retirement - the Roth looks like the clear
winner.

Is this process too easy or am I missing something.  Had we
opened a 
Roth to begin with, would he not have owed all the taxes on the
2000 
this year?

Converting it now seems to easy a way to spread the taxes over 4
years! 
Is this a loophole waiting for a fix or what?

Thanks

Mike Morehouse
mikemore@hotmail.com

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