Many Americans are using a previously little-known tax method to boost their savings.Now, the government is trying to stop it.
The tax strategy at issue is the mega-backdoor Roth conversion and it has allowed some Americans to amass sizable balances in tax-free Roth retirement accounts
This week Democrats on the House Ways and Means Committee voted to advance dozens of proposed tax changes.Some are tax increases that would raise more than $2 trillion of revenue to help fund the party’s priorities.
Also proposed is an outright ban on the “mega backdoor Roth” conversion using workplace retirement plans, which allowed high-income Americans to put $58,000 into a Roth account this year.If passed, that proposal would be effective next year.
House Ways and Means Committee Chairman Richard Neal’s plan to usher in several changes to individual retirement accounts “will not likely see much pushback because most people will never have to worry about their IRA balances exceeding $20 million,” IRA and tax specialist Ed Slott of Ed Slott & Co.told ThinkAdvisor late Monday in an email
Christine Benz: Hi, I'm Christine Benz from Morningstar.The Secure Act ushered in new rules for inherited IRAs
Solo 401(k)s — in addition to company 401(k)s — can help clients save additional retirement money on an after-tax basis, even with the possibility of converting them to mega backdoor Roth IRAs, but there are rules, according to Ian Berger, an IRA analyst with Ed Slott & Co.
Say you started with $40,000 in before-tax contributions to non-Roth IRAs and another $10,000 in after-tax contributions to other non-Roth IRAs.That means 80% of your total non-Roth IRA accounts were made with pre-tax dollars
Christine Benz: Hi, I'm Christine Benz from Morningstar.For charitably inclined older adults, a qualified charitable distribution often beats making a charitable contribution and deducting it on your tax return
Saving for retirement? Good start. But almost everyone has something to learn about optimizing their individual retirement account from IRA strategist Ed Slott. Also, the next round of retirement-planning changes Congress is eyeing.
The entire cryptocurrency market climbed to more than $2 trillion over the weekend for the first time since mid-May.
Bitcoin, one of the more popular digital offerings, also surged to more than $48,000, though it has already lost some of those gains.
If you’re like many investors, you may be wondering how you can get in on the action.That could include your retirement savings vehicles, such as individual retirement accounts.
