As Chairman of the Wisconsin Bankers Association (WBA) Trust Section Board, I find it unacceptable on behalf of our customers that the state of Wisconsin has not adopted the 2010 federal law amendment allowing any IRA owner to convert his or her Traditional IRA to a Roth IRA regardless of income level. I’m afraid to say that our state legislators have fallen asleep at the wheel on this one. These days when Madison is searching for every conceivable method to raise revenue for the state (mostly through taxes) – the state legislators have overlooked a federal amendment to the tax law.
At the federal level, an IRA owner (even if their adjusted gross income is greater than $100,000) can convert his or her Traditional IRA to a Roth IRA and pay the taxes owed on the conversion over a two-year period (2011 and 2012). This means tax dollars in Madison’s coffers in the calendar years of 2011 and 2012. This would enable some Wisconsin residents to take advantage of a great tax-planning tool while actually living in the state – a rarity indeed!
This is a win-win for the state and its residents. We just need the legislators to wake up and realize what this amendment can do for the state – for its residents and for the state budget.
I just participated in a conference call with other WBA Trust Section Board members to help move this along. As a result of the call, the WBA liaison to the state legislators is attempting to schedule meetings with the Wisconsin Department of Revenue and the Wisconsin Joint Finance Committee to present the federal amendment and the potential impact for the state. With only two or three “floor” days left before December, the WBA has its work cut out for it. The theme of the meetings will be, “Revenue Generation for the State.” If this doesn’t get Madison’s attention, I’m not sure what will.
Come on Madison, let’s get this right!