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system
funneling money from a traditional ira to a roth ira using options: is my method possible and tax legal?
user
i am not a lawyer, but i can't think of a reason this is illegal (something that would be illegal would be to "trade with yourself" across the accounts to try to manipulate stock or option prices). i don't think you're "funneling," you're doing "asset location" which is a standard tax planning strategy. http://news.morningstar.com/articlenet/article.aspx?id=154126&t1=1303874170 discusses asset location. i'd be more concerned about whether it makes sense.
assistant