There has been much written about the fact that the income limit on converting to a Roth IRA has been eliminated as of January 1, 2010.  However, converting to a Roth IRA could be very costly. 

Converting a regular IRA to a Roth will result in a federal tax of up to 35% in 2010.  If you elect to pay the tax in 2011 and 2012, you may be doing so at a higher rate.  The Obama administration has been talking about increasing tax rates for high income individuals. 

Further, the writers who are suggesting conversion are ignoring another substantial tax, namely, state taxes.  For example, if you are a New Jersey resident and you convert, you will be paying a tax of up to 10.75% of the converted amount.  We are advising all our clients not to simply convert based on what has been written by the media, but to give careful consideration to the fact that taxes will substantially reduce the amount converted.