There is no future income limit changes for regular Roth contributions, just for conversions. However, anyone with earned income can contribute to a TIRA account without a deduction. They can then convert that contribution tax free providing they have no other non Roth IRA assets. If they do, the basis is pro rated over the entire balance.

Many high earners never made TIRA contributions because they could not deduct them, and therefore have very little in TIRA accounts. That makes the above strategy worth considering. For example, next month someone could contribute 5,000 (plus any catchup) for 2009 and 2010, then immediately convert tax free if they have no other IRAs. This pattern could be continued indefinitely as a work around to the regular contribution income limit or until Congress takes some action to eliminate this strategy or make it unnecessary by doing away with the income limits.

• Flag as spam
• Log in to Reply