We have continued to get a lot of your questions about all things Roth, so we are dedicating another episode to your Roth questions. We answer questions about SEP-IRA conversions, Roth IRA contributions, Roth contributions in a 401(k) vs. a Backdoor Roth, Mega Backdoor Roth questions, how taxes affect Roth conversions, and more!
Listen to Episode #316 here.
Today, we are talking about all things Roth. Roth retirement accounts are named after William Roth, a former senator, and were introduced in 1997 with the Roth IRA legislation. “Roth” is not an acronym but rather the senator’s name. Roth accounts refer to tax-free contributions, where money is invested after being taxed, and withdrawals are not taxed later. There are penalties if you do any withdrawals before retirement age, although there are many exceptions. The contribution limits for Roth IRAs in 2023 are $6,500 ($7,500 for people above age 50). Separate limits allow contributions of $22,500 to Roth 401(k) or Roth…
This article was written by Megan Scott and originally published on www.whitecoatinvestor.com