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How to Use the Backdoor Roth IRA

Автор: Steve | Call to Leap

Загружено: 2023-07-13

Просмотров: 7480

Описание:

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-The backdoor Roth IRA is a strategy used by high earners for converting a traditional IRA to a Roth IRA.
-Using this strategy, you can contribute to an IRA and roll them over to a Roth IRA or convert an entire IRA to a Roth.
-The backdoor Roth IRA strategy is a legal way to get around the income limits that usually prevent high earners from owning Roth IRAs.
-The backdoor Roth IRA strategy is not a tax dodge—in fact, it may incur higher taxes when it’s established—but you'll get the future tax savings of a Roth account.
-The backdoor Roth IRA strategy is also beneficial for someone who anticipates having funds leftover in their traditional IRA because they can pass the money on to their heirs in a Roth IRA.

3 ways to use the backdoor Roth IRA:

1. Contribute money to an existing traditional IRA and then roll over the funds to a Roth IRA. Or you can roll over existing traditional IRA money into a Roth—as much as you want at one time, even if it’s more than the annual contribution limit.
2. Convert your entire traditional IRA to a Roth IRA.
3. If your company 401(k) plan allows conversions, you can roll your 401(k) account over to a Roth IRA.

Hope this helps!

Let me know if you have questions below!

-Steve


#calltoleap #financialfreedom #financialliteracy #money #personalfinance #investing #millionaire #makemoney #entrepreneur #stockmarket #stocks #ETFS #rothira #backdoorrothira #taxhacks

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How to Use the Backdoor Roth IRA

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