Backdoor Roth confused and frustrated

Have a question about your personal investments? No matter how simple or complex, you can ask it here.
Post Reply
Topic Author
RoundingAgain
Posts: 10
Joined: Mon Apr 05, 2021 2:10 pm

Backdoor Roth confused and frustrated

Post by RoundingAgain »

I seem to get conflicting info from various sources, I’ve talked to a Schwab retirement rep, broker rep, and a Vanguard rep and am just more confused than before. I would appreciate and help/clarity for my particular situation. I’m going to label the accounts A, B, C, D to avoid confusion.

I currently have with Schwab…
(A) - Rollover IRA (401k from previous employer) that has received no further contributions. ($150k)

With Vanguard through current employer…
(B) - 401k ($600k)

I’ve never opened a Roth IRA and realized I should, however I exceed the income limit for a single filer (~$170k/yr), so it seems a backdoor is the route I have to go.

As I understand it I cannot have or need to get rid of my rollover IRA at Schwab (A) as this is considered a tIRA. Note, I never made any further contributions to this account after rolling over my 401k, so I’ve never claimed any deductions - which is a point of confusion for me that I’ll address later regarding being taxes twice.

My understanding is that I can rollover the rollover IRA (A) at Schwab into my current employers 401k at Vanguard (B) and this won’t have any tax consequences as this is just moving pretax contributions from one account to another (A to B)?

So I’ll sell the holdings in (A) have Schwab send me a check payable to “Vanguard Fiduciary Trust Company, For the benefit of Me” and mail that check with the rollover form to Vanguard and reinvest those funds inside my current 401k (B)?

Then close out the rollover IRA account at Schwab (A).

Open a NEW unfunded tIRA (call this account C), fund that with post tax contributions, then convert that to a newly opened unfunded Roth IRA (call this D)?

Is that correct so far?

1) My first question is do I have to pay taxes on the new tIRA > backdoor Roth (C to D) contributions ($6k/yr) since it will be funded with post tax money?

Reps and websites seem to insinuate I do, but I don’t understand why I have to pay income tax twice if I’ve already paid income taxes on the money funding the (C to D) tIRA > backdoor Roth?

2) The mechanics and timeline of the actual conversion process, funding, investing, converting are confusing as well… once I have accounts C and D set up, a new unfunded tIRA and new unfunded Roth IRA I intend to backdoor into ($0 balances with plans to fund the max $6k/yr going forward)… Assume I fund the tIRA (C) Jan 1st with $6k post tax money…

-When can I initiate the backdoor Roth conversion (C to D)?

-Is that an immediate process, fund C then convert to D? Or is there an amount of time funds have to sit in C before converting to D?

-Can investments be converted or do I have to divest any investment in C before converting to D? Just hold a cash balance in C before converting or can I actually (or should I) purchase investments before starting the conversion process to D?

I’d appreciate any help, super frustrating.
livesoft
Posts: 76659
Joined: Thu Mar 01, 2007 8:00 pm

Re: Backdoor Roth confused and frustrated

Post by livesoft »

You can make a contribution to a nondeductible traditional IRA. IRS Form 8606 has a section that you fill out for that.

You can convert any portion of your traditional IRAs to a Roth IRA without making any contributions to any Roth IRA or even to a nondeductible traditional IRA. You will have to declare untaxed traditional IRA contributions and gains as taxable income. IRS Form 8606 has a section that you fill out for that.

OK, now to your questions which probably may have been answered by my 2 statements above.
Wiki This signature message sponsored by sscritic: Learn to fish.
withrye
Posts: 102
Joined: Mon Feb 29, 2016 1:48 pm

Re: Backdoor Roth confused and frustrated

Post by withrye »

A can be rolled into B without any tax owed. Some 401k "reverse" rollovers can accept an electronic transfer, but if they cannot then you're right regarding the sale, mailing of the check, and passing forward of that check.

C can be converted as soon as the contribution settles, which is often the next day for an established account but may be several days for a new account and initial contribution. Invested funds can be converted, but if you want to simplify Form 8606 and tax owed you can hold cash in account C before converting to account D. You can reuse the same account C and D year after year.

You will not owe taxes twice on the C to D conversion. You are putting nondeductible (read:post-tax) funds in the tIRA (C) and when you convert there's no additional tax for converting that contribution basis.
livesoft
Posts: 76659
Joined: Thu Mar 01, 2007 8:00 pm

Re: Backdoor Roth confused and frustrated

Post by livesoft »

RoundingAgain wrote: Thu Jun 10, 2021 6:24 pmAs I understand it I cannot have or need to get rid of my rollover IRA at Schwab (A) as this is considered a tIRA.
Taken at face value, the above statement is FALSE. You can have that IRA and do not need to get rid of it. However, if you have it, then you will have to declare as taxable income any portion of it that you convert to a Roth IRA.
My understanding is that I can rollover the rollover IRA (A) at Schwab into my current employers 401k at Vanguard (B) and this won’t have any tax consequences as this is just moving pretax contributions from one account to another (A to B)?
Not all 401(k) plans allow one to rollover IRA assets into the 401(k) plan, but if your 401(k) plan allows it, then your statement should be true.
So I’ll sell the holdings in (A) have Schwab send me a check payable to “Vanguard Fiduciary Trust Company, For the benefit of Me” and mail that check with the rollover form to Vanguard and reinvest those funds inside my current 401k (B)?
Yes, that should work, but do not tell Schwab that you want a check. Get your employer's 401(k) plan to ask Schwab to rollover the IRA money to then. It may come in the form of a check to you as you have described. If your employer's 401(k) balks at this, then let us know.
1) My first question is do I have to pay taxes on the new tIRA > backdoor Roth (C to D) contributions ($6k/yr) since it will be funded with post tax money?

Reps and websites seem to insinuate I do, but I don’t understand why I have to pay income tax twice if I’ve already paid income taxes on the money funding the (C to D) tIRA > backdoor Roth?
Please read IRS Form 8606 and its Instructions. If you follow the easy Instructions and look at the form while doing so, your question will be answered.
Wiki This signature message sponsored by sscritic: Learn to fish.
livesoft
Posts: 76659
Joined: Thu Mar 01, 2007 8:00 pm

Re: Backdoor Roth confused and frustrated

Post by livesoft »

RoundingAgain wrote: Thu Jun 10, 2021 6:24 pm2) The mechanics and timeline of the actual conversion process, funding, investing, converting are confusing as well… once I have accounts C and D set up, a new unfunded tIRA and new unfunded Roth IRA I intend to backdoor into ($0 balances with plans to fund the max $6k/yr going forward)… Assume I fund the tIRA (C) Jan 1st with $6k post tax money…

-When can I initiate the backdoor Roth conversion (C to D)?

If you open your Roth IRA at the same place that you have your nondeductible traditional IRA at, then you can initiate the Roth conversion as soon as the website lets you. It could be 0 to 7 days.
-Is that an immediate process, fund C then convert to D? Or is there an amount of time funds have to sit in C before converting to D?
At Vanguard it is like a mutual fund exchange or a sell then a buy. It is not an immediate process, but close enough to not worry about.
-Can investments be converted or do I have to divest any investment in C before converting to D? Just hold a cash balance in C before converting or can I actually (or should I) purchase investments before starting the conversion process to D?
If the investment is a mutual fund, then the same number of shares that are sold will be the same number of shares that are bought, so it will look like the shares moved even if they were in cash for a femtosecond. I am not sure about ETFs.
Wiki This signature message sponsored by sscritic: Learn to fish.
Katietsu
Posts: 4970
Joined: Sun Sep 22, 2013 1:48 am

Re: Backdoor Roth confused and frustrated

Post by Katietsu »

RoundingAgain wrote: Thu Jun 10, 2021 6:24 pm I seem to get conflicting info from various sources, I’ve talked to a Schwab retirement rep, broker rep, and a Vanguard rep and am just more confused than before. I would appreciate and help/clarity for my particular situation. I’m going to label the accounts A, B, C, D to avoid confusion.

I currently have with Schwab…
(A) - Rollover IRA (401k from previous employer) that has received no further contributions. ($150k)

With Vanguard through current employer…
(B) - 401k ($600k)

I’ve never opened a Roth IRA and realized I should, however I exceed the income limit for a single filer (~$170k/yr), so it seems a backdoor is the route I have to go.

As I understand it I cannot have or need to get rid of my rollover IRA at Schwab (A) as this is considered a tIRA. Note, I never made any further contributions to this account after rolling over my 401k, so I’ve never claimed any deductions - which is a point of confusion for me that I’ll address later regarding being taxes twice.

My understanding is that I can rollover the rollover IRA (A) at Schwab into my current employers 401k at Vanguard (B) and this won’t have any tax consequences as this is just moving pretax contributions from one account to another (A to B)?

So I’ll sell the holdings in (A) have Schwab send me a check payable to “Vanguard Fiduciary Trust Company, For the benefit of Me” and mail that check with the rollover form to Vanguard and reinvest those funds inside my current 401k (B)?

This all sounds fine. The exact details can vary depending on the broker and the employer plan. So you will need to follow the instructions given to you by Schwab and Vanguard. Go over all the forms before you take action.

Then close out the rollover IRA account at Schwab (A).
If you plan to continue to use Schwab for your IRAs, this is unnecessary. You can just continue using the same traditional IRA

Open a NEW unfunded tIRA (call this account C), fund that with post tax contributions, then convert that to a newly opened unfunded Roth IRA (call this D)?
Fine
Is that correct so far?

1) My first question is do I have to pay taxes on the new tIRA > backdoor Roth (C to D) contributions ($6k/yr) since it will be funded with post tax money?
No taxes as a result of the conversion when the amount being converted is equal to the non deductible contribution. Many people do pay taxes on Roth conversions because they are converting pre-tax money. You will not.
Reps and websites seem to insinuate I do, but I don’t understand why I have to pay income tax twice if I’ve already paid income taxes on the money funding the (C to D) tIRA > backdoor Roth?

2) The mechanics and timeline of the actual conversion process, funding, investing, converting are confusing as well… once I have accounts C and D set up, a new unfunded tIRA and new unfunded Roth IRA I intend to backdoor into ($0 balances with plans to fund the max $6k/yr going forward)… Assume I fund the tIRA (C) Jan 1st with $6k post tax money…

-When can I initiate the backdoor Roth conversion (C to D)?
Basically, right away. My IRA provider makes me wait 2 days if I use an ACH transfer or mobile deposit because they subject the the contribution to the standard withdrawal hold. Annoying. But other brokerages do not do this.
-Is that an immediate process, fund C then convert to D? Or is there an amount of time funds have to sit in C before converting to D?

-Can investments be converted or do I have to divest any investment in C before converting to D? Just hold a cash balance in C before converting or can I actually (or should I) purchase investments before starting the conversion process to D?
Either way, depending on the brokerage. Personally, though, I would just contribute cash, leave it as cash, and then convert. I would just invest after the conversion. It just seems simpler to me.

I’d appreciate any help, super frustrating.
livesoft
Posts: 76659
Joined: Thu Mar 01, 2007 8:00 pm

Re: Backdoor Roth confused and frustrated

Post by livesoft »

One more thing. It will be likely that your nondeductible traditional IRA contribution has some growth before it is converted. It may grow by 1 cent or $10. Be sure to convert ALL of your nondeductible traditional IRA including any growth that it has. Form 8606 is your friend and on it you will sort out how much of your conversion is taxed and how much is not taxed.
Wiki This signature message sponsored by sscritic: Learn to fish.
Topic Author
RoundingAgain
Posts: 10
Joined: Mon Apr 05, 2021 2:10 pm

Re: Backdoor Roth confused and frustrated

Post by RoundingAgain »

Appreciate all responses!
withrye wrote: Thu Jun 10, 2021 6:30 pm A can be rolled into B without any tax owed. Some 401k "reverse" rollovers can accept an electronic transfer, but if they cannot then you're right regarding the sale, mailing of the check, and passing forward of that check.

C can be converted as soon as the contribution settles, which is often the next day for an established account but may be several days for a new account and initial contribution. Invested funds can be converted, but if you want to simplify Form 8606 and tax owed you can hold cash in account C before converting to account D. You can reuse the same account C and D year after year.

You will not owe taxes twice on the C to D conversion. You are putting nondeductible (read:post-tax) funds in the tIRA (C) and when you convert there's no additional tax for converting that contribution basis.
So in this example on January 1st of every year, to simplify the tax form 8606 - I can just fund and leave a cash balance in C, convert C to D within a day or two (January 2nd/3rd), then invest the cash now in D into whatever ETF I want. And just repeat that every year? That’s the simplest process for tax purposes?
Topic Author
RoundingAgain
Posts: 10
Joined: Mon Apr 05, 2021 2:10 pm

Re: Backdoor Roth confused and frustrated

Post by RoundingAgain »

Katietsu wrote: Thu Jun 10, 2021 6:44 pm
RoundingAgain wrote: Thu Jun 10, 2021 6:24 pm I seem to get conflicting info from various sources, I’ve talked to a Schwab retirement rep, broker rep, and a Vanguard rep and am just more confused than before. I would appreciate and help/clarity for my particular situation. I’m going to label the accounts A, B, C, D to avoid confusion.

I currently have with Schwab…
(A) - Rollover IRA (401k from previous employer) that has received no further contributions. ($150k)

With Vanguard through current employer…
(B) - 401k ($600k)

I’ve never opened a Roth IRA and realized I should, however I exceed the income limit for a single filer (~$170k/yr), so it seems a backdoor is the route I have to go.

As I understand it I cannot have or need to get rid of my rollover IRA at Schwab (A) as this is considered a tIRA. Note, I never made any further contributions to this account after rolling over my 401k, so I’ve never claimed any deductions - which is a point of confusion for me that I’ll address later regarding being taxes twice.

My understanding is that I can rollover the rollover IRA (A) at Schwab into my current employers 401k at Vanguard (B) and this won’t have any tax consequences as this is just moving pretax contributions from one account to another (A to B)?

So I’ll sell the holdings in (A) have Schwab send me a check payable to “Vanguard Fiduciary Trust Company, For the benefit of Me” and mail that check with the rollover form to Vanguard and reinvest those funds inside my current 401k (B)?

This all sounds fine. The exact details can vary depending on the broker and the employer plan. So you will need to follow the instructions given to you by Schwab and Vanguard. Go over all the forms before you take action.

Then close out the rollover IRA account at Schwab (A).
If you plan to continue to use Schwab for your IRAs, this is unnecessary. You can just continue using the same traditional IRA

Open a NEW unfunded tIRA (call this account C), fund that with post tax contributions, then convert that to a newly opened unfunded Roth IRA (call this D)?
Fine
Is that correct so far?

1) My first question is do I have to pay taxes on the new tIRA > backdoor Roth (C to D) contributions ($6k/yr) since it will be funded with post tax money?
No taxes as a result of the conversion when the amount being converted is equal to the non deductible contribution. Many people do pay taxes on Roth conversions because they are converting pre-tax money. You will not.
Reps and websites seem to insinuate I do, but I don’t understand why I have to pay income tax twice if I’ve already paid income taxes on the money funding the (C to D) tIRA > backdoor Roth?

2) The mechanics and timeline of the actual conversion process, funding, investing, converting are confusing as well… once I have accounts C and D set up, a new unfunded tIRA and new unfunded Roth IRA I intend to backdoor into ($0 balances with plans to fund the max $6k/yr going forward)… Assume I fund the tIRA (C) Jan 1st with $6k post tax money…

-When can I initiate the backdoor Roth conversion (C to D)?
Basically, right away. My IRA provider makes me wait 2 days if I use an ACH transfer or mobile deposit because they subject the the contribution to the standard withdrawal hold. Annoying. But other brokerages do not do this.
-Is that an immediate process, fund C then convert to D? Or is there an amount of time funds have to sit in C before converting to D?

-Can investments be converted or do I have to divest any investment in C before converting to D? Just hold a cash balance in C before converting or can I actually (or should I) purchase investments before starting the conversion process to D?
Either way, depending on the brokerage. Personally, though, I would just contribute cash, leave it as cash, and then convert. I would just invest after the conversion. It just seems simpler to me.

I’d appreciate any help, super frustrating.
Thanks again 🙏🏻
an_asker
Posts: 3300
Joined: Thu Jun 27, 2013 2:15 pm

Re: Backdoor Roth confused and frustrated

Post by an_asker »

livesoft wrote: Thu Jun 10, 2021 6:43 pm
RoundingAgain wrote: Thu Jun 10, 2021 6:24 pm2) The mechanics and timeline of the actual conversion process, funding, investing, converting are confusing as well… once I have accounts C and D set up, a new unfunded tIRA and new unfunded Roth IRA I intend to backdoor into ($0 balances with plans to fund the max $6k/yr going forward)… Assume I fund the tIRA (C) Jan 1st with $6k post tax money…

-When can I initiate the backdoor Roth conversion (C to D)?

If you open your Roth IRA at the same place that you have your nondeductible traditional IRA at, then you can initiate the Roth conversion as soon as the website lets you. It could be 0 to 7 days.
[...]
I am curious why you deleted the word backdoor. Isn't that the specific term for this Roth conversion or am I confused (too)? :oops:
livesoft
Posts: 76659
Joined: Thu Mar 01, 2007 8:00 pm

Re: Backdoor Roth confused and frustrated

Post by livesoft »

an_asker wrote: Thu Jun 10, 2021 7:45 pmI am curious why you deleted the word backdoor. Isn't that the specific term for this Roth conversion or am I confused (too)? :oops:
Backdoor means nothing in the context of this thread. The specific term in not needed especially when talking to Schwab, Vanguard, and reading the IRS forms and instructions. Use the front door of a nondeductible IRA contribution.

Image
Wiki This signature message sponsored by sscritic: Learn to fish.
retiredjg
Posts: 44439
Joined: Thu Jan 10, 2008 12:56 pm

Re: Backdoor Roth confused and frustrated

Post by retiredjg »

RoundingAgain wrote: Thu Jun 10, 2021 6:24 pm 2) The mechanics and timeline of the actual conversion process, funding, investing, converting are confusing as well… once I have accounts C and D set up, a new unfunded tIRA and new unfunded Roth IRA I intend to backdoor into ($0 balances with plans to fund the max $6k/yr going forward)… Assume I fund the tIRA (C) Jan 1st with $6k post tax money…
Be sure the 401k will accept the rollover IRA. If yes, do that first.

Once that is completed, open a tIRA (and a Roth IRA). Put $6k into the tIRA and invest in money market or something similar. The next day, do a Roth conversion on that account. You do not have to wait until January 1st to do this.

I’d appreciate any help, super frustrating.
The procedure is easy. Documenting it on your taxes is tricky. Do not depend on a tax-preparer to know what to do because many do not.

I suggest you download a Form 8606 (2020 will do) and pencil through both Section 1 and 2 to see how this works.

Do you do your own taxes?
retiredjg
Posts: 44439
Joined: Thu Jan 10, 2008 12:56 pm

Re: Backdoor Roth confused and frustrated

Post by retiredjg »

RoundingAgain wrote: Thu Jun 10, 2021 6:24 pm As I understand it I cannot have or need to get rid of my rollover IRA at Schwab (A) as this is considered a tIRA. Note, I never made any further contributions to this account after rolling over my 401k, so I’ve never claimed any deductions - which is a point of confusion for me that I’ll address later regarding being taxes twice.
This rollover IRA contains pre-tax money from your old 401k. It will not be taxed twice.


1) My first question is do I have to pay taxes on the new tIRA > backdoor Roth (C to D) contributions ($6k/yr) since it will be funded with post tax money?

Reps and websites seem to insinuate I do, but I don’t understand why I have to pay income tax twice if I’ve already paid income taxes on the money funding the (C to D) tIRA > backdoor Roth?
No, you do not pay taxes on this twice. They likely do not understand that the contribution is non-deductible (already taxed).
User avatar
David Jay
Posts: 11077
Joined: Mon Mar 30, 2015 5:54 am
Location: Michigan

Re: Backdoor Roth confused and frustrated

Post by David Jay »

an_asker wrote: Thu Jun 10, 2021 7:45 pm
livesoft wrote: Thu Jun 10, 2021 6:43 pm
RoundingAgain wrote: Thu Jun 10, 2021 6:24 pm2) The mechanics and timeline of the actual conversion process, funding, investing, converting are confusing as well… once I have accounts C and D set up, a new unfunded tIRA and new unfunded Roth IRA I intend to backdoor into ($0 balances with plans to fund the max $6k/yr going forward)… Assume I fund the tIRA (C) Jan 1st with $6k post tax money…

-When can I initiate the backdoor Roth conversion (C to D)?

If you open your Roth IRA at the same place that you have your nondeductible traditional IRA at, then you can initiate the Roth conversion as soon as the website lets you. It could be 0 to 7 days.
[...]
I am curious why you deleted the word backdoor. Isn't that the specific term for this Roth conversion or am I confused (too)? :oops:
If you look at the Wiki page (link below), you will see that the term “backdoor Roth” is the term for this entire process.

There is no such thing as a “backdoor Roth account”, you use a plain-old Roth account. You use a plain-old traditional IRA (tIRA) account. You make a non-deductible contribution to the tIRA, this is probably the most unique step of the process, something few investors ever do. You make a plain-old Roth conversion. You document everything on an 8606 each year.

Wiki link: https://www.bogleheads.org/wiki/Backdoor_Roth
Prediction is very difficult, especially about the future - Niels Bohr | To get the "risk premium", you really do have to take the risk - nisiprius
epargnant
Posts: 137
Joined: Wed Dec 06, 2017 10:34 am

Re: Backdoor Roth confused and frustrated

Post by epargnant »

RoundingAgain wrote: Thu Jun 10, 2021 6:24 pm

As I understand it I cannot have or need to get rid of my rollover IRA at Schwab (A) as this is considered a tIRA. Note, I never made any further contributions to this account after rolling over my 401k, so I’ve never claimed any deductions - which is a point of confusion for me that I’ll address later regarding being taxes twice.
You've gotten great responses. I agree it seems confusing but hopefully they have helped. This is definitely a (legal) loophole type thing available only to certain people in certain circumstances. (For example people with a 401K available at work that takes tIRA rollovers, or people who have never rolled an old 401K into a tIRA or deducted tIRA contributions).

In response to your statement that I bolded- You DID get a deduction, when you contributed to your 401K. You didn't have to claim it on your taxes, it was automatically handled by payroll & reflected on your W2. But you benefited from your 401K contributions just like people benefit from making deductible tIRA contributions. In the end pre-tax 401Ks and tIRAs are treated the same in retirement in terms of taxes.

I think the confusing part is the rule that you are allowed to have as much as you want in a 401K account and complete the backdoor Roth process with no taxes due. However if you have a tIRA (whether 401K rollover or direct contributions that you deducted from income) your backdoor options are limited because you are not allowed to only convert your non-deductible contributions, you must do a pro-rated mix and pay taxes on the part of the conversion coming from pre-tax or deducted money.

All financial institutions assume that taxes are due on tIRA to Roth conversions because they do not have enough information about your finances to know whether you owe taxes. For example Vanguard has no idea if you have a tIRA at a different financial institution. They also cannot keep track of whether contributions were pre-tax (old 401K) or whether you deducted them from your income. It's on you to keep track of non-deducted contributions through form 8606. Conversions are considered taxable events and generate a 1099. The backdoor Roth process, in the right circumstances, will lead to no taxes due. So yes, expect the brokerage firms to tell you you're engaging in a taxable event. It doesn't mean you're doing it wrong!
an_asker
Posts: 3300
Joined: Thu Jun 27, 2013 2:15 pm

Re: Backdoor Roth confused and frustrated

Post by an_asker »

David Jay wrote: Fri Jun 11, 2021 7:56 am
an_asker wrote: Thu Jun 10, 2021 7:45 pm
livesoft wrote: Thu Jun 10, 2021 6:43 pm
RoundingAgain wrote: Thu Jun 10, 2021 6:24 pm2) The mechanics and timeline of the actual conversion process, funding, investing, converting are confusing as well… once I have accounts C and D set up, a new unfunded tIRA and new unfunded Roth IRA I intend to backdoor into ($0 balances with plans to fund the max $6k/yr going forward)… Assume I fund the tIRA (C) Jan 1st with $6k post tax money…

-When can I initiate the backdoor Roth conversion (C to D)?

If you open your Roth IRA at the same place that you have your nondeductible traditional IRA at, then you can initiate the Roth conversion as soon as the website lets you. It could be 0 to 7 days.
[...]
I am curious why you deleted the word backdoor. Isn't that the specific term for this Roth conversion or am I confused (too)? :oops:
If you look at the Wiki page (link below), you will see that the term “backdoor Roth” is the term for this entire process.

There is no such thing as a “backdoor Roth account”, you use a plain-old Roth account. You use a plain-old traditional IRA (tIRA) account. You make a non-deductible contribution to the tIRA, this is probably the most unique step of the process, something few investors ever do. You make a plain-old Roth conversion. You document everything on an 8606 each year.

Wiki link: https://www.bogleheads.org/wiki/Backdoor_Roth
I hear you. I understand it but probably Livesoft thought that OP doesn't, so that makes sense why Livesoft deleted the word.

I thought that if OP thought that the official term included the word backdoor, he/she would have capitalized it thus -> Backdoor Roth.
livesoft
Posts: 76659
Joined: Thu Mar 01, 2007 8:00 pm

Re: Backdoor Roth confused and frustrated

Post by livesoft »

an_asker wrote: Fri Jun 11, 2021 11:00 am I hear you. I understand it but probably Livesoft thought that OP doesn't, so that makes sense why Livesoft deleted [crossed out] the word.
:sharebeer
Wiki This signature message sponsored by sscritic: Learn to fish.
an_asker
Posts: 3300
Joined: Thu Jun 27, 2013 2:15 pm

Re: Backdoor Roth confused and frustrated

Post by an_asker »

livesoft wrote: Fri Jun 11, 2021 11:09 am
an_asker wrote: Fri Jun 11, 2021 11:00 am I hear you. I understand it but probably Livesoft thought that OP doesn't, so that makes sense why Livesoft deleted [crossed out] the word.
:sharebeer
Where's that Like button? ;-)
User avatar
neurosphere
Posts: 4194
Joined: Sun Jan 17, 2010 1:55 pm

Re: Backdoor Roth confused and frustrated

Post by neurosphere »

When recommending this process to people I usually say "you should put money into a Roth IRA via an indirect or 2-step method which is colloquially referred to by many as the "backdoor" method of funding a Roth IRA".

It's a mouthful but it doesn't leave much room for confusion. :D
If you have to ask "Is a Target Date fund right for me?", the answer is "Yes".
Post Reply