Congress giveth and Congress taketh away, as witness the latest tune-up for the Roth Individual Retirement Account. In "technical corrections" likely to become law in mid-July, Congress is tinkering with rules that could affect IRA owners thinking of converting old accounts to Roth IRAs. Roth IRAs don't give a tax break on deposits but allow both deposits and earnings to be withdrawn tax-free in retirement.

The bill will create an escape hatch for investors who switch. Conversions are barred for those who earn over $100,000, which discourages people who can't predict their income. Now, if savers convert an IRA, then find at yearend that their income exceeds the cap, they can switch back with no penalty. They must reverse the conversion by the due date of their tax return.

Congress also wants to close a loophole that would have let IRA owners convert accounts to Roth IRAs, then withdraw the funds without a penalty. Such conversions, as with other Roth accounts, will be subject to a 10% penalty on funds withdrawn less than five years after the IRA is set up.

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