Should I do backdoor Roth?

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Topic Author
ync
Posts: 4
Joined: Mon May 09, 2016 8:55 am

Should I do backdoor Roth?

Post by ync » Thu Feb 13, 2020 10:01 am

My husband and I both have 401K, Traditional IRA, and Roth IRA accounts. We contribute to max for our 401K and HSA every year. We also have around 100K in taxable account, which is set aside for retirement. I've been contributing to Roth from our taxable account every year. But this is the first year that we are not eligible for Roth contribution. I'm wondering if I should start doing backdoor Roth or just leave the money in taxable account. Since we have money in traditional IRA, we will need to pay tax when we do backdoor Roth.

mystupidglasses
Posts: 22
Joined: Tue Sep 15, 2015 4:52 pm

Re: Should I do backdoor Roth?

Post by mystupidglasses » Thu Feb 13, 2020 10:16 am

What are the balances in your tIRAs? You need to beware of the "pro-rata rule" since you have existing tIRA balances: https://www.bogleheads.org/wiki/Backdoor_Roth#Cautions

SovereignInvestor
Posts: 534
Joined: Mon Aug 20, 2018 4:41 pm

Re: Should I do backdoor Roth?

Post by SovereignInvestor » Thu Feb 13, 2020 10:19 am

Depends how much is in traditional relative to.the 6K or whatever that can be backed doored?

Can you move TIRA to the 401k to avoid pro rata rule?

Also can owly do TIRA to ROTH conversions for a while until TIRA balance is low or zero to avoid pro rata rule.

Topic Author
ync
Posts: 4
Joined: Mon May 09, 2016 8:55 am

Re: Should I do backdoor Roth?

Post by ync » Thu Feb 13, 2020 10:22 am

My husband has around 120K in Traditional IRA and I have 44K. I'll look into moving the fund to 401K.

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