AI Snips
Chapters
Transcript
Episode notes
Fix Roth Conversion Tax Mistakes
- If you filed taxes incorrectly for a Roth conversion, file Form 1040-X and include Form 8606 to amend and reclaim overpaid tax.
- Hire or ask your preparer to file the amendment; it's a normal fix.
Split Contributions And Know Pro Rata Scope
- Splitting contributions 50/50 between pre-tax and Roth is a reasonable hedge if future tax circumstances are unknown.
- Employer plan balances (401k/403b/457) do not trigger the IRA pro rata rule for backdoor Roths.
Mega Backdoor Roth Explained
- The 'mega backdoor Roth' uses after-tax 401(k) contributions plus in-plan or rollover conversions to create large amounts of Roth money.
- This bypasses IRA pro rata limits and can add tens of thousands to Roth annually if the plan allows it.