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Posted: 3/23/2017 9:49:46 PM EDT
So the "I'm a failed QB, look at my hot wife and give me advice" thread reminded me that I needed to research that Roth I've been thinking about starting to supplement the 401k, reduce tax liability in retirement etc.  So I'm reading up about contribution limits on Vanguard and apparently Roths have income limits.  WTF?  So if you make decent money you lose savings options?  You're already paying higher taxes your whole career and now you can't even take advantage of some tax savings for a retirement account?!?  Seriously fucked.
Link Posted: 3/23/2017 9:50:35 PM EDT
[#1]
......
Link Posted: 3/23/2017 9:51:46 PM EDT
[#2]
Fpni
Link Posted: 3/23/2017 9:51:52 PM EDT
[#3]
Welcome to US tax policy for the last several decades!  The more you make, the more tax you pay, with less tax-advantaged ways to save too!

Congress should be ashamed.
Link Posted: 3/23/2017 9:52:17 PM EDT
[#4]
Discussion ForumsJump to Quoted PostQuote History
Quoted:
Fpni
View Quote
Funny.  On iPad and hit quote instead of edit.
Link Posted: 3/23/2017 9:52:37 PM EDT
[#5]
the rothchilds do not have income limits, no.

ETA:  not fair you changed it

Link Posted: 3/23/2017 9:53:18 PM EDT
[#6]
Open a traditional IRA, transfer 5500, call your bank and tell them you want to do a conversion to a roth ira.

If you have USAA they will do it all for you over the phone.

You're welcome.
Link Posted: 3/23/2017 9:53:49 PM EDT
[#7]
Discussion ForumsJump to Quoted PostQuote History
Quoted:
the rothchilds do not have income limits, no.
View Quote
Autocorrect damnit.
Link Posted: 3/23/2017 9:54:14 PM EDT
[#8]
Discussion ForumsJump to Quoted PostQuote History
Quoted:
the rothchilds do not have income limits, no.

ETA:  not fair you changed it

View Quote
Haha
Link Posted: 3/23/2017 9:55:01 PM EDT
[#9]
Quoted:
So the "I'm a failed QB, look at my hot wife and give me advice" thread
View Quote


    Link Posted: 3/23/2017 9:55:07 PM EDT
    [#10]
    Discussion ForumsJump to Quoted PostQuote History
    Quoted:
    Open a traditional IRA, transfer 5500, call your bank and tell them you want to do a conversion to a roth ira.

    You're welcome.
    View Quote
    Can you do that if you currently have a 401k w/ employer?  What about continued contributions?
    Link Posted: 3/23/2017 9:55:09 PM EDT
    [#11]
    Quoted:
    So the "I'm a failed QB, look at my hot wife and give me advice" thread reminded me that I needed to research that Roth I've been thinking about starting to supplement the 401k, reduce tax liability in retirement etc.  So I'm reading up about contribution limits on Vanguard and apparently Roths have income limits.  WTF?  So if you make decent money you lose savings options?  You're already paying higher taxes your whole career and now you can't even take advantage of some tax savings for a retirement account?!?  Seriously fucked.
    View Quote
    uhh yeah, if that pisses you off, don't start researching income limits for other tax breaks, like student loan interest. . .


    ETA: also look up backdoor roth.
    Link Posted: 3/23/2017 9:56:20 PM EDT
    [#12]
    Wealthy people already know how to get tax breaks through their businesses.
    Link Posted: 3/23/2017 9:56:24 PM EDT
    [#13]
    Discussion ForumsJump to Quoted PostQuote History
    Quoted:


    Can you do that if you currently have a 401k w/ employer?  What about continued contributions?
    View Quote
    The financial adviser I worked with at USAA said we could.
    Link Posted: 3/23/2017 9:57:36 PM EDT
    [#14]
    Quoted:
    So the "I'm a failed QB, look at my hot wife and give me advice" thread reminded me that I needed to research that Roth I've been thinking about starting to supplement the 401k, reduce tax liability in retirement etc.  So I'm reading up about contribution limits on Vanguard and apparently Roths have income limits.  WTF?  So if you make decent money you lose savings options?  You're already paying higher taxes your whole career and now you can't even take advantage of some tax savings for a retirement account?!?  Seriously fucked.
    View Quote

    Google mega backdoor Roth.
    Link Posted: 3/23/2017 9:57:55 PM EDT
    [#15]
    LOL.  So just because a guy played QB at level you couldn't even sniff, but isn't a star in the NFL now you say he failed?  So what have you done as an athlete that tops being a QB at a D1 school?  Let me guess, if you didn't blow your knee out in HS you woulda coulda shoulda....
    Link Posted: 3/23/2017 9:59:23 PM EDT
    [#16]
    Humble brag thread.








    Link Posted: 3/23/2017 9:59:24 PM EDT
    [#17]
    Discussion ForumsJump to Quoted PostQuote History
    Quoted:


    Can you do that if you currently have a 401k w/ employer?  What about continued contributions?
    View Quote
    Yes, you can do it if you currently have a 401k. 

    You can do this every year. It's simplest if you have no existing traditional IRA. If you do have an existing traditional IRA for which you have taken write-offs for the contributions already, you will have to pay tax on a portion of the conversion each time you do it. 
    Link Posted: 3/23/2017 9:59:45 PM EDT
    [#18]
    Discussion ForumsJump to Quoted PostQuote History
    Quoted:


    Can you do that if you currently have a 401k w/ employer?  What about continued contributions?
    View Quote
    Yes you can do it with a 401k. Just Google Roth Ira conversion and start reading. You basically bounce money through a regular post tax Ira. The only thing is that if you have any money in a regular Ira already, you get hit on taxes for the full amount of the earnings from it. If you don't have one, no problem.

    I did ghost last year. Opened both on schwab, transfered money into the regular Ira, then into the Roth 5 min later. Perfectly legal. Now the money grows tax free.
    Link Posted: 3/23/2017 9:59:53 PM EDT
    [#19]
    Discussion ForumsJump to Quoted PostQuote History
    Quoted:


    uhh yeah, if that pisses you off, don't start researching income limits for other tax breaks, like student loan interest. . .


    ETA: also look up backdoor roth.
    View Quote
    Lol, the wife and I kissed that deduction away years ago.  But student loan deductions is peanuts compared to no Roth IRA.
    Link Posted: 3/23/2017 10:02:02 PM EDT
    [#20]
    Discussion ForumsJump to Quoted PostQuote History
    Quoted:
    LOL.  So just because a guy played QB at level you couldn't even sniff, but isn't a star in the NFL now you say he failed?  So what have you done as an athlete that tops being a QB at a D1 school?  Let me guess, if you didn't blow your knee out in HS you woulda coulda shoulda....
    View Quote
    Ever hear of humor?  Sorry I triggered you, and sorry about your knees.....
    Link Posted: 3/23/2017 10:02:47 PM EDT
    [#21]
    Discussion ForumsJump to Quoted PostQuote History
    Quoted:
    The financial adviser I worked with at USAA said we could.
    View Quote View All Quotes
    View All Quotes
    Discussion ForumsJump to Quoted PostQuote History
    Quoted:
    Quoted:


    Can you do that if you currently have a 401k w/ employer?  What about continued contributions?
    The financial adviser I worked with at USAA said we could.
    Correct, you just don't get a tax deduction.  This is called a back door Roth conversion
    Link Posted: 3/23/2017 10:03:41 PM EDT
    [#22]
    Discussion ForumsJump to Quoted PostQuote History
    Quoted:
    Yes, you can do it if you currently have a 401k. 

    You can do this every year. It's simplest if you have no existing traditional IRA. If you do have an existing traditional IRA for which you have taken write-offs for the contributions already, you will have to pay tax on a portion of the conversion each time you do it. 
    View Quote
    That's good info to know.  Wife has IRA, I only have 401k but we file jointly.  I'll have to do more research.  Hopefully I can keep the Roth on my side and avoid the extra taxes.
    Link Posted: 3/23/2017 10:06:32 PM EDT
    [#23]
    Penny stocks and young Roths are a perfect marrage.

    Remember dont buy into a dilution a scheme, be the dilution scheme.

    Im sure there are Roths worth BILLIONS
    Link Posted: 3/23/2017 10:06:40 PM EDT
    [#24]
    Discussion ForumsJump to Quoted PostQuote History
    Quoted:
    Humble brag thread.








    View Quote
    It's still fucked.  Seriously.  I can understand a cap amount much higher, but where they have it set is just silly.
    Link Posted: 3/23/2017 10:14:20 PM EDT
    [#25]
    Penny stocks and young Roths are a perfect marrage.

    Remember dont buy into a dilution a scheme, be the dilution scheme.

    Im sure there are Roths worth BILLIONS
    Link Posted: 3/23/2017 10:18:30 PM EDT
    [#26]
    I'll have a coke.
    Link Posted: 3/23/2017 10:29:31 PM EDT
    [#27]
    Discussion ForumsJump to Quoted PostQuote History
    Quoted:
    So the "I'm a failed QB, look at my hot wife and give me advice" thread
    View Quote


    Link?
    Link Posted: 3/23/2017 10:30:32 PM EDT
    [#28]
    Discussion ForumsJump to Quoted PostQuote History
    Quoted:
    That's good info to know.  Wife has IRA, I only have 401k but we file jointly.  I'll have to do more research.  Hopefully I can keep the Roth on my side and avoid the extra taxes.
    View Quote View All Quotes
    View All Quotes
    Discussion ForumsJump to Quoted PostQuote History
    Quoted:
    Quoted:
    Yes, you can do it if you currently have a 401k. 

    You can do this every year. It's simplest if you have no existing traditional IRA. If you do have an existing traditional IRA for which you have taken write-offs for the contributions already, you will have to pay tax on a portion of the conversion each time you do it. 
    That's good info to know.  Wife has IRA, I only have 401k but we file jointly.  I'll have to do more research.  Hopefully I can keep the Roth on my side and avoid the extra taxes.
    I opened a Traditional IRA back in 2008 or so with after-tax dollars in anticipation of the income limit going away in 2010.  I thought for sure Obama would keep it closed and was pleasantly surprised he didn't!  I converted the traditional to a Roth and have been doing so ever since as has my wife.  Max out the 401K and Roth every year.  529 as well if you have kids.
    Link Posted: 3/23/2017 11:16:50 PM EDT
    [#29]
    Discussion ForumsJump to Quoted PostQuote History
    Quoted:
    Lol, the wife and I kissed that deduction away years ago.  But student loan deductions is peanuts compared to no Roth IRA.
    View Quote View All Quotes
    View All Quotes
    Discussion ForumsJump to Quoted PostQuote History
    Quoted:
    Quoted:


    uhh yeah, if that pisses you off, don't start researching income limits for other tax breaks, like student loan interest. . .


    ETA: also look up backdoor roth.
    Lol, the wife and I kissed that deduction away years ago.  But student loan deductions is peanuts compared to no Roth IRA.
    not for me
    Link Posted: 3/23/2017 11:25:33 PM EDT
    [#30]
    Read a book.
    The rules are clear.
    Link Posted: 3/24/2017 3:32:56 AM EDT
    [#31]
    1%-er 1st world problems.
    Link Posted: 3/24/2017 4:27:49 AM EDT
    [#32]
    Let me get this straight...If I make more than 70k I can't deduct an IRA contribution from my taxes?  But if I convert that contribution to a Roth IRA, the earnings aren't taxable?

    what kind of nonsense is this..it's almost like you are being penalized for working hard and making money.
    Link Posted: 3/24/2017 4:40:10 AM EDT
    [#33]
    And if you think that's bad, both thanks to 0bamacare, there's the Medicare Surcharge (an extra 0.9% of your income) and the Net Investment Income Tax (3.8% of your investment [i.e. passive] income) gone as well.

    Thanks, 0bama!

    These two taxes, BTW, are what Pelosi is whining about when she accuses the Republicans of transferring billions of $to the wealthiest Americans by eliminating 0bamacare.

    Yea, they're transferring billions back to rich people by stopping the transfer of billions from "rich" people to poor people.
    Link Posted: 3/24/2017 5:21:30 AM EDT
    [#34]
    Translation "I'm rich woe is me"
    Link Posted: 3/24/2017 5:35:46 AM EDT
    [#35]
    Lemme guess, OP is between 35 and 45, making the best money they ever had, and just realized that they are fucked.  Gummint gets most of what you make.

    Stick some cash in one of those ' don't pay taxes later, pay em now', accounts, and be thankful the gummint lets you keep some.

    ETA:  No, I'm not bitter.  Roads and shit.
    Link Posted: 3/24/2017 5:37:19 AM EDT
    [#36]
    Discussion ForumsJump to Quoted PostQuote History
    Quoted:
    Translation "I'm rich woe is me"
    View Quote
    Rich?  The phase-out income for a Roth IRA is $187,000 for married filing jointly.  For every $1,000 in income after that, your Roth contribution limit drops $500 PER PERSON.  If that is rich, things really have gone to shit.

    OP, my wife and I had this happen for the first time this year.  I didn't even know it was a thing.  Our combined AGI was $192,000 I think.  So we had to open up HSAs to lower our AGI.  So fucking stupid.  We busted our asses last year, made good money, saved, invested, etc.  "Oh thank you very much Mr./Mrs. hard-working responsible citizen.  FUCK YOU, PAY ME EVEN MORE!!!!"   I fucking hate tax time.

    It won't be an issue again. We have our first kid due in June, so with her being out a few months after the birth, our income will be lower.  Still a ridiculous thing.
    Link Posted: 3/24/2017 5:41:40 AM EDT
    [#37]
    Discussion ForumsJump to Quoted PostQuote History
    Quoted:


    Rich?  The phase-out income for a Roth IRA is $187,000 for married filing jointly.  For every $1,000 in income after that, your Roth contribution limit drops $500 PER PERSON.  If that is rich, things really have gone to shit.

    OP, my wife and I had this happen for the first time this year.  I didn't even know it was a thing.  Our combined AGI was $192,000 I think.  So we had to open up HSAs to lower our AGI.  So fucking stupid.  We busted our asses last year, made good money, saved, invested, etc.  "Oh thank you very much Mr./Mrs. hard-working responsible citizen.  FUCK YOU, PAY ME EVEN MORE!!!!"   I fucking hate tax time.

    It won't be an issue again. We have our first kid due in June, so with her being out a few months after the birth, our income will be lower.  Still a ridiculous thing.
    View Quote
    Yep.  Worthy of a bump.
    Link Posted: 3/24/2017 7:33:40 AM EDT
    [#38]
    Discussion ForumsJump to Quoted PostQuote History
    Quoted:
    Rich?  The phase-out income for a Roth IRA is $187,000 for married filing jointly.  For every $1,000 in income after that, your Roth contribution limit drops $500 PER PERSON.  If that is rich, things really have gone to shit.

    OP, my wife and I had this happen for the first time this year.  I didn't even know it was a thing.  Our combined AGI was $192,000 I think.  So we had to open up HSAs to lower our AGI.  So fucking stupid.  We busted our asses last year, made good money, saved, invested, etc.  "Oh thank you very much Mr./Mrs. hard-working responsible citizen.  FUCK YOU, PAY ME EVEN MORE!!!!"   I fucking hate tax time.

    It won't be an issue again. We have our first kid due in June, so with her being out a few months after the birth, our income will be lower.  Still a ridiculous thing.
    View Quote View All Quotes
    View All Quotes
    Discussion ForumsJump to Quoted PostQuote History
    Quoted:
    Quoted:
    Translation "I'm rich woe is me"
    Rich?  The phase-out income for a Roth IRA is $187,000 for married filing jointly.  For every $1,000 in income after that, your Roth contribution limit drops $500 PER PERSON.  If that is rich, things really have gone to shit.

    OP, my wife and I had this happen for the first time this year.  I didn't even know it was a thing.  Our combined AGI was $192,000 I think.  So we had to open up HSAs to lower our AGI.  So fucking stupid.  We busted our asses last year, made good money, saved, invested, etc.  "Oh thank you very much Mr./Mrs. hard-working responsible citizen.  FUCK YOU, PAY ME EVEN MORE!!!!"   I fucking hate tax time.

    It won't be an issue again. We have our first kid due in June, so with her being out a few months after the birth, our income will be lower.  Still a ridiculous thing.
    Did you bother to read the fucking thread???  You cannot contribute DIRECTLY to a Roth IRA if you are above the income limit.

    However, since 2010, you can convert to a Roth IRA by first contributing after tax dollars to a Traditional IRA and then the very next day convert it to a Roth IRA.  THERE IS NO INCOME LIMIT TO DO THIS.  Yes, this is a loophole which is why they call it a "Backdoor Roth IRA".  

    Even better, us rich mofos figured out that we could open up a Traditional IRA before 2010, load it up every year with $5K each (that has increased to $5.5K and more if you're older) and in 2010 we could convert it all to a Roth IRA when the old rules expired.  That's $11K total per year in a Roth per couple.
    Link Posted: 3/24/2017 7:52:26 AM EDT
    [#39]
    Discussion ForumsJump to Quoted PostQuote History
    Quoted:


    Did you bother to read the fucking thread???  You cannot contribute DIRECTLY to a Roth IRA if you are above the income limit.

    However, since 2010, you can convert to a Roth IRA by first contributing after tax dollars to a Traditional IRA and then the very next day convert it to a Roth IRA.  THERE IS NO INCOME LIMIT TO DO THIS.  Yes, this is a loophole which is why they call it a "Backdoor Roth IRA".  

    Even better, us rich mofos figured out that we could open up a Traditional IRA before 2010, load it up every year with $5K each (that has increased to $5.5K and more if you're older) and in 2010 we could convert it all to a Roth IRA when the old rules expired.  That's $11K total per year in a Roth per couple.
    View Quote
    I have had a Roth open since I was 22.  I'm 30 now.  This is the first year we have had income over the limit.  I never even knew it was a thing.  Our contributions are drafted automatically each month.  So they are fully funded by 12/31.  My tax person told me this week that I made excess contributions due to income.  I was not commenting on other iras, backdoor or otherwise.
    Link Posted: 3/24/2017 7:55:34 AM EDT
    [#40]
    Discussion ForumsJump to Quoted PostQuote History
    Quoted:
    I have had a Roth open since I was 22.  I'm 30 now.  This is the first year we have had income over the limit.  I never even knew it was a thing.  Our contributions are drafted automatically each month.  So they are fully funded by 12/31.  My tax person told me this week that I made excess contributions due to income.  I was not commenting on other iras, backdoor or otherwise.
    View Quote View All Quotes
    View All Quotes
    Discussion ForumsJump to Quoted PostQuote History
    Quoted:
    Quoted:


    Did you bother to read the fucking thread???  You cannot contribute DIRECTLY to a Roth IRA if you are above the income limit.

    However, since 2010, you can convert to a Roth IRA by first contributing after tax dollars to a Traditional IRA and then the very next day convert it to a Roth IRA.  THERE IS NO INCOME LIMIT TO DO THIS.  Yes, this is a loophole which is why they call it a "Backdoor Roth IRA".  

    Even better, us rich mofos figured out that we could open up a Traditional IRA before 2010, load it up every year with $5K each (that has increased to $5.5K and more if you're older) and in 2010 we could convert it all to a Roth IRA when the old rules expired.  That's $11K total per year in a Roth per couple.
    I have had a Roth open since I was 22.  I'm 30 now.  This is the first year we have had income over the limit.  I never even knew it was a thing.  Our contributions are drafted automatically each month.  So they are fully funded by 12/31.  My tax person told me this week that I made excess contributions due to income.  I was not commenting on other iras, backdoor or otherwise.
    Then why complain about something that isn't a problem??  You still have time to contribute/convert.
    Link Posted: 3/24/2017 8:11:14 AM EDT
    [#41]
    Link Posted: 3/24/2017 8:25:03 AM EDT
    [#42]
    See my sigline.
    Link Posted: 3/24/2017 8:35:52 AM EDT
    [#43]
    Discussion ForumsJump to Quoted PostQuote History
    Quoted:
    Open a traditional IRA, transfer 5500, call your bank and tell them you want to do a conversion to a roth ira.

    If you have USAA they will do it all for you over the phone.

    You're welcome.
    View Quote
    this

    It is a perfectly legal backdoor to get around Roth income limit
    Link Posted: 3/24/2017 8:39:44 AM EDT
    [#44]
    I'm just here for the link to the QB thread.

    OP, google "backdoor roth IRA"

    I looked into this yesterday a bit. I'm 30 and all we have is my wife's 401k, I need to start contributing to an IRA so we have a little it extra.
    Link Posted: 3/24/2017 8:45:51 AM EDT
    [#45]
    Discussion ForumsJump to Quoted PostQuote History
    Quoted:
    Penny stocks and young Roths are a perfect marrage.

    Remember dont buy into a dilution a scheme, be the dilution scheme.

    Im sure there are Roths worth BILLIONS
    View Quote
    You can say that again
    Link Posted: 3/24/2017 8:58:44 AM EDT
    [#46]
    Discussion ForumsJump to Quoted PostQuote History
    Quoted:
    You can say that again
    View Quote View All Quotes
    View All Quotes
    Discussion ForumsJump to Quoted PostQuote History
    Quoted:
    Quoted:
    Penny stocks and young Roths are a perfect marrage.

    Remember dont buy into a dilution a scheme, be the dilution scheme.

    Im sure there are Roths worth BILLIONS
    You can say that again
    I have no idea what you're talking about.
    Link Posted: 3/24/2017 9:00:08 AM EDT
    [#47]
    Discussion ForumsJump to Quoted PostQuote History
    Quoted:


    uhh yeah, if that pisses you off, don't start researching income limits for other tax breaks, like student loan interest. . .


    ETA: also look up backdoor roth.
    View Quote


    Do the above! Backdoor Roth IRA can be done in addition to 401k. You can fully fund 401k @ $18k/year and do the after-tax contributions and roll that to a Roth IRA every year. Up to $35,000/year. That's $53,000/year you can contribute to retirement with tax advantages.
    Link Posted: 3/24/2017 9:58:24 AM EDT
    [#48]
    Vanguard?

    Create Traditional IRA.
    Create ROTH IRA.
    Put money into Traditional on monday.
    It clears and goes in Tuesday.
    Wednesday click on the "convert to ROTH IRA" button.

    Done.


    The worst part is that it is tens of thousands of dollars for limits in difference if are married vs single.
    Link Posted: 3/24/2017 10:01:36 AM EDT
    [#49]
    My tax guy is always referencing the AMT.
    Link Posted: 3/24/2017 10:10:46 AM EDT
    [#50]
    Discussion ForumsJump to Quoted PostQuote History
    Quoted:
    [/b][/red]That's $53,000/year you can contribute to retirement with tax advantages.[/size=6]
    View Quote
    and if that's not enough for some folks, there is always the possibility of getting a HDHP and contributing the max ($6750 for 2017, for a family, less if your single) to an HSA, which can also be used as 'retirement money' once you reach the age of 65.

    I did this for a single year about 5 years ago and it gives me a lot of peace of mind to know that I have $6k, most of which I can invest in the market, as a 'emergency medical fund' if I need it. Sure, $6k doesn't buy much care these days, but presuming you have SOME kind of insurance, it would definitely help. Better than not having any $ saved. If I don't use it it just continues to grow with the market.
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