Backdoor Roth IRA Strategy:
High income earners are generally ineligible to contribute directly to Roth IRAs, but this IRS-approved strategy allows even those who have income above the limits to fund Roth accounts annually.
Basic steps include:
- Open a Traditional IRA
- Make a non-deductible contribution up to the annual limit
- Convert the amount to Roth IRA
- Individual has effectively “contributed” to a Roth IRA and can repeat steps each year
For a more detailed review of this strategy, including IRS income limits, annual contributions limits, and the Pro Rata Rule, download the PDF below.
(Approval code: BF1/BFA0048)
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