Remember all, you can make deposits into a nondeductible IRA for 2006, 2007, 2008, and 2009. And in 2010, you can convert the funds to a Roth IRA.

You will be taxed on the growth of the $ from these four years, but not on the original contributions. You could deposit $4,000 in 2006 and 2007, $5,000 in 2008 and 2009. Limits are $1,000 higher each year if you are age 50 or higher.

With luck, you'll have earnings of a few thousand dollars by 2010. Do the conversion, and 5 years later you have a completely tax-free account! Only the earnings are taxed, and the tax is spread over your 2010 and 2011 returns.

Food for thought!