Roth IRA Two-Step (Advanced)

May 14, 2012

A small recap – last week, we discussed The Roth IRA Two-Step, the ability to deposit money to a traditional IRA and immediately convert the funds with no tax due. In effect, a ‘back-door’ to the Roth for those whose incomes exceed the limits for a Roth deposit. Since nothing in the tax code is […]

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The Roth IRA Two-Step

May 8, 2012

As I last wrote, the ability to deposit money into a Roth IRA is phased out if you are single with a MAGI of $125,000, or married with a MAGI $183,000. However, all is not lost. The rules for conversion changed way back in 2010, and the income limit for a Roth conversion was eliminated. […]

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The IRA Phaseout Gap

May 3, 2012

In much of the discussion of the Roth IRA, there’s little mention of the  one area where there’s no decision, the Roth is the way to go. It’s the gap between the Traditional IRA phaseout and the Roth phaseout. Let’s look at where, exactly, this occurs in 2012. Single – Traditional IRA Phaseout – Begins […]

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The Roth IRA Recharacterization

April 30, 2012

Last time, we discussed the Roth IRA Conversion. Let me ask you a question. Did you ever wish for a financial do-over? How would you like to go back, say 10 years, and be able to tell your broker you prefer to not buy those banking stock, but instead, load up on Apple? Well, that […]

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The Roth IRA Conversion

April 26, 2012

A Roth IRA conversion is an interesting opportunity. When you first deposited to your IRA, you may have had the chance to choose between the Traditional IRA or the Roth. While your investments may have been chosen for the long term, the choice of Traditional IRA did not have to be forever. You have the […]

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Using the Roth IRA for College

April 23, 2012

Dave asks, “What are the pros and cons of using Roth IRAs to save for your children’s college (as opposed to 529 plans)?” Let’s start with the positives – Withdrawal of principal (always) and growth (if held to age 59-1/2) is tax free regardless of how spent. 529 choices are limited and can be expensive […]

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