After-tax 401(k)的税务规则类似于高收入人士的traditional IRA,存入税后收入,取出时盈利部分还要再缴收入税,因此其本身并非省税利器。但正如高收入人士的traditional IRA是backdoor Roth的中转工具,after-tax 401(k)是一种叫mega backdoor Roth操作的中转工具。相比backdoor Roth每年数千的额度,me...
Withdrawals of after-tax contributions to a traditional IRA should not be taxed. However, the only way to make sure this doesn't happen is to file IRSForm 8606. Form 8606 must be filed for every year you make after-tax contributions to a traditional IRA and for every subsequent year until...
After-tax contribution refers to the monetary contribution made to retirement systems after deducting taxes from the individual’s or corporation’s taxable income. In the U.S., there are two main types of after-tax contributions – the traditional after-tax contribution and the Roth 401(k) aft...
You canconvertthe entire traditional IRA account to a Roth IRA. This is an especially good strategy if your tax bracket in retirement is actually going to be higher than it was in your working days; however, bear in mind you will owe income taxes on the entire account in the year you co...
Any earnings would need to be rolled over to a traditional IRA. What if you’ve contributed the maximum amount of pre-tax (and/or Roth) dollars to your employer-sponsored 401(k) plan, but you still want to grow this fund for retirement? “In some cases, it’s possible to make after...
Let’s say that Peggy, who recently retired, takes distributions totaling $25,000 from her traditional IRA. That account has a balance of $300,000 at the end of the same year, and her after-tax basis in the IRA is $100,000. She also owns a SEP IRA, which has a balance of $200...
after-tax Financial Related to after-tax:After-tax income,Profit After Tax af·ter-tax (ăf′tər-tăks′) adj. Relating to or being that which remains after payment of taxes, especially of income taxes:after-tax profits. American Heritage® Dictionary of the English Language, Fifth ...
For example, your reported taxable income for the year would be $38,000 if your taxable income was going to be $40,000 for a given year and you put $2,000 of it in a pre-tax account such as a traditional IRA. The Internal Revenue Service (IRS) caps the amount you can deposit ...
Your tax bill isn't chiseled in stone at the end of the year. Here are 10 tax tips and steps you can take after January 1 to help you lower your taxes, save money when preparing your tax return, and avoid tax penalties.
Key benefits of putting money in a traditional IRA after maxing out your 401(k) Anyone can make contributions to a traditional IRA up to the lesser of their earned income or the annual contribution limit Potential tax deduction Tax-deferred growth Main drawbacks of saving in an individual retire...