“Back Door” Roth IRAs Officially Get Green Light from IRS

Posted on July 27, 2018

The IRS recently published some great news, especially for high income earners, regarding "back-door" Roth IRAs.

For those of you that are unfamiliar with this term, the back-door Roth allows high income earners to bypass the Roth IRA contribution income limits. It works like this: if you are under 70.5 years of age, you can make a nondeductible traditional IRA contribution. For 2018, you can contribute up to $5,500 ($6,500 if you are 50 or over). Your high income is not a problem as there are no income limits on nondeductible traditional IRA contributions. Next, you convert your 2018 traditional...

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Woohoo, Qualified Charitable Contributions are Now “Permanent!”

Posted on December 21, 2015

If you’ve been waiting on the edge of your seat to find out whether or not your 2015 charitable distribution is qualified, you can now sit back and smile. Congress is providing you with an early Christmas gift!

In case you haven’t heard yet, the President will be signing a bill to bring back the Qualified Charitable Distribution (QCD) – not only for 2015 but “permanently.”  This means that if you made what you hoped to be a QCD on or after January 1, 2015, you will qualify to transfer up to $100,000 from your...

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Passing Down Wealth without a Stretch IRA

Posted on July 26, 2013

In a recent post, we discussed the impact that President Obama’s proposal might have on retirement plans and savers. In this week’s video, we explore the proposal’s elimination of the stretch IRA and how it impacts other options to pass along your wealth.

A stretch IRA is a wealth transfer concept that allows retirement account owners to name their heirs as beneficiaries to their Traditional IRA or Roth IRA. This allows them to “stretch out” distributions over a number of years or generations and provides beneficiaries with tax-deferred growth....

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8 Steps to Help Ensure Your Money is Inherited by Whom You Intended

Posted on November 20, 2012

If you attended Ed Slott’s presentation that we sponsored last month, you already know why this is so important and the first thing you did when you got home was check all of your beneficiary forms to make sure they are up to date. However, if you missed his presentation (or even if you just want to refresh your memory), do not – we repeat – do not skip over this post.

Why is this so important you might ask? Let us tell you a true story: A man named his three children as beneficiaries...

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Dividing Roth IRAs for Inherited Accounts?

Posted on September 16, 2011

If your Roth IRA account is divided equally among your beneficiaries, will it hold true to your wishes or must you divide your Roth IRA into separate Roths for each beneficiary?

As long as the designation of your beneficiary form is filled out correctly (lists primary beneficiaries by name and the percentages to each) the Roth IRA can then be separated into shares in an inherited IRA for each beneficiary. Confirm this with whomever manages your Roth IRA account to make sure it is set up correctly.

You can also, however, establish separate accounts during...

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