Backdoor Roth IRAs: How Do They Work?

Roth IRAs are a great tool for setting money aside to be used tax-free in retirement, but there are income limits on Roth IRAs: $140,000 for single filers and $208,000 for joint filers. Fortunately, even if you are above the income threshold, there is still a way to put money into a Roth IRA.

The “Backdoor” Roth IRA is a loophole that allows high earners to make nondeductible contributions to a traditional IRA, then convert it to a Roth IRA. This Kiplinger article explains how the process works and outlines everything you need to know about Backdoor Roth IRAs.

Click here to read

This communication is for informational purposes only. No content or reference to a third-party article is intended to be a recommendation for the sale or investment in any product, strategy or service nor should it be perceived as individual advice. This commentary does not necessarily reflect the opinions of all employees or XML Financial Group and its affiliates (“XML”).  XML is not responsible for any actions taken related to this information.