Backdoor ROTH IRA for 2023 and beyond

[@lindaalely4305]

I hear it and I can’t believe it! As a second generation Latina and growing up low income I never imagine following awesome guys like these two. I find the information very helpful and the more I listen is easier to understand. Looking forward to applying lots of this helpful tips in my life and share the knowledge with others. Thank you so much for tons of wealth given via the information you provide.

[@jgleigh]

One clarification, you can contribute to a Traditional IRA until April 15, 2023 and have it count for tax-year 2022, but the Roth conversion will still be recorded for tax-year 2023. This affects how you fill out Form 8606.

[@Marysiewert]

what about a beneficiary IRA?

[@bloomingy]

My husband did backdoor conversion early 2022 (while no existing transitional IRA balance) and later in the year, my husband got company contribution into SEP account that wasn't expected. Is this okay since we didn't have any money in T-IRA at the time of conversion? or if it's an issue, how can would fix it?

[@kjones4470]

I heard something about doing the backdoor Roth from Traditional IRA to Roth that money cannot be used for 5 yrs from the time of the conversion?

[@GoldmanBoudro]

I am 40 with rental properties, consulting income, and a W-2 job There were several years that I did not contribute to the 401k and IRA accts like I should have. Investing in a Roth IRA that I have put the $6k in each year. Currently working a W-2 job 401k plan and a 4% match. My income from the day job is around 90k-105k just depending overtime etc. It is easy for me to max out my 401k which is $22500. Doing the backdoor Roth with more of my income or rental income is the goal. What should I do to get to where I can put at least 50k a year in retirement accts? I have all the Books , and audiobooks. Doing the backdoor Roth is still not 100% clear to me. Thank you Matt I greatly appreciate all you and Mark do from the bottom of my heart!

[@alrocky]

If your income is too high you are precluded from making a *_direct_* contribution to Roth IRA so you contribute *_indirectly_* by using back door Roth IRA process: contribute $6,500 to traditional IRA and promptly convert that $6,500 t-IRA to $6,500 Roth IRA. Caveat: if you have existing traditional IRA balance from prior years will complicate process as pro rata tax will be apply. You can avoid pro rata tax if you move all traditional IRA to your traditional 401(k). . You may contribute $22,500 to 401(k) and $6,500 to Roth IRA. If you can afford $50k and assuming your 401(k) has good investment options and low fees, you should consider $22,500 to Roth 401(k) and $6,500 Roth IRA.

[@IronBurden]

All my contributions are non-deductible (already taxed) If I do a max contribution of $6k to a traditional IRA this year Next year could I do another max contribution of $6.5k? And then convert the full traditional IRA of $12.5k to ROTH (2023)?

[@alrocky]

You may convert any amount from your traditional IRA to Roth IRA. If you have existing traditional IRA from prior years pro rata tax applies.

[@OfficiallyKiaraJ]

Hello, Can you speak on back door Roth if you are married and filing separate? I know you can’t fund a Roth IRA if you are married and filing separate if you make over 10,000 a year so I wanted to know more info about doing a back door Roth IRA by first contributing to a traditional ira than converting it.

[@MatSorensen]

There is indeed an income limit for Roth contributions, but currently, there is no income limit for Roth Conversions. If you have the satisfactory income to make a Traditional Contribution, you can then convert that to Roth. We always recommend you consult with a tax advisor for your personal tax questions. Nate Hare, Executive Director Directed IRA For more information, please email [e-mail]

[@amaligio]

Ok, so me and my accountant are butting heads right now. She's saying I would need to pay taxes because no taxes were paid going in, and I'm saying that it's a non-deductible contribution, so no taxes should be paid on that conversion. Am I missing something here, or should I changed my accountant?

[@osito852gmail]

With the new secure 2.0 act, can I start and max a Roth SEP IRA and still do backdoor Roth (prior years had nothing in any type of IRA)? Specifically worried about line item # 6 on form 8606

[@harsharao3555]

Nice video. Great information. Schwab and Fidelity both have wonderful service representatives who understand back door ROTHIRA. Also don't waste away your tax free ROTH dollars on start up investments. Be safe. Happy holidays. Great video guys, thanks.

[@MatSorensen]

For investors who want to invest in alternative assets such as real estate and notes, Directed IRA is ideal and we are rated #1 in the Industry for fast processing times. Schwab and Fidelity are great for stocks, bonds and mutual funds.

[@manuvns]

is SEP-IRA subject to pro-rata rule

[@cesarrivas3598]

Did IRS extend filing for counties in California that declared an emergency due to heavy rains? if so, does this extend the date for the conversion also?

[@AuntieReRee]

What if you opened. Roth IRA then realized you were not supposed to how do you fix it

[@MatSorensen]

If you haven't contributed to the account, you can simply remove the account. If you have contributed, you would need to distribute those funds, if you are younger than 59 1/2 this will be a taxable event. If you opened it with us at Directed IRA you can call in and one of our specialists can assist you! directedira.com

[@istvanmolnar5938]

IS THERE ANY AGE LIMITATIONS FOR THE BACK DOOR ROTH IRA ? I AM 70 YEARS OLD.

[@alrocky]

no

[@jamesholt7898]

Here's my situation. My salary was always around $50K and in 2022 and for now on it's around $120K. I maxed my 401K contributions in 2022 I have a company Fidelity 401K with a company match of .50 on the dollar unto 6% which is made in April. I started to fund and am making monthly deposits into my allowable $7500/yr traditional Roth while I will max out my 401K this year. I have no HSA btw. Do have to wait to max out my 401K to contribute into this 3rd bucket? Is it better to go outside the company to contribute to this 3rd bucket or with my company if they allow this back door opportunity? Im trying to grasp this concept and appreciate any guidance. Im 51 and really need to kick my retirement up a big notch.thx

[@alokjr]

Thanks for the awesome content. Is this still relevant with the "Build Better Back" ACT? here is the act verbiage: In order to close this so-called “back-door” Roth IRA strategy, and a similar one for retirement plans, this section prohibits all employee after-tax contributions in qualified plans and after-tax IRA contributions from being converted to Roth regardless of income level, effective for distributions, transfers, and contributions made after December 31, 2021.

[@jgleigh]

The Build Back Better Act didn't make it through Congress. Back-door Roth conversions are still allowed with current law.

[@ryants1]

1. How much of my traditional IRA can I convert to a Roth IRA? 2. Also my company offers a Roth 401k but I do not contribute. I only max my traditional 401k. Am I missing out on anything?

[@alrocky]

Q1 You may convert any amount from your traditional IRA to Roth IRA Q2 You should favor contributing to Roth 401(k) when in relatively low tax bracket. If you're in relatively high tax bracket, you're okay contributing to traditional 401(k).

[@ryants1]

@@alrocky I can’t contribute to Roth IRA due to too high of an income. How does this differ your above answer? Sorry for any confusion, no one I know makes above the limit so I can’t ask for help around me.

[@alrocky]

@@ryants1 You may convert traditional IRA to Roth IRA. While you're over the income limit for *_direct_* contribution to Roth IRA you may still perform a *_back door_* Roth IRA: contribute $6,500 to traditional IRA and then convert that $6,500 t-IRA to $6,500 Roth IRA. You have time still to contribute $6,000 to your 2022 traditional IRA and back door that to $6,000 Roth IRA. Fill out Form 8606.

[@ryants1]

@@alrocky awesome. Thank you so much! I’m 28 and no one seems to have an easy answer for me. I still haven’t filled yet for 2022 so I’ll look into doing that

[@sksman71]

​@alrocky so I'm 52 I can contribute $8000 a year to my Roth IRA. If I open a traditional IRA and Invest $10,000 could I roll over that 10k into my Roth IRA?

[@jefferyshall]

The ONLY crappy thing about this you HAVE TO keep your records (8606) perfectly straight and keep them all and have it in order all the way until you retire.

[@ixanaths]

kzbin.info/www/bejne/o3vYZ3WCe8aIiq8 once are on say TDAmeritrade platform and click the button to convert your traditional IRA to Roth, it will trigger a 1099 at year end that you need to report as income. How do you avoid that with the backdoor Roth ? TDAmeritrade does not distinguish regular Roth conversion vs backdoor Roth conversion.

[@ixanaths]

got it, form 8606 solves the 1099 problem, thank you kzbin.info/www/bejne/o3vYZ3WCe8aIiq8

[@coolguy5409]

BEN