The Mega Backdoor Roth IRA allows you to contribute after-tax 401k contributions and then roll them over into a Roth IRA.
This strategy is particularly valuable for high earners who exceed the income limits for a regular Roth IRA. By leveraging their 401(k), they can save up to $70,000 in 2025—or $77,500 if they’re 50 or older—while taking full advantage of tax-free growth and withdrawals. These figur...
If you make less than $140,000 as a single person (or $208,000 for married couples filing jointly), you fall within the Roth IRA income limits. In that case, there is no reason to use the “backdoor” because you can make a regular contribution to a Roth IRA. If your income is ...
AMega Backdoor Rothmeans making non-Roth after-tax contributions to a 401k-type plan and then moving it to the Roth account within the plan or taking the money out (with earnings) to a Roth IRA. If you’re looking for the regular backdoor Roth, where you contribute to a Traditional IR...
2025, please followSplit-Year Backdoor Roth IRA in TurboTax, 1st Year. If you contributed to a Traditional IRA for 2023 in 2024 and converted in 2024 or if you recharacterized a 2023 Roth contribution in 2024 and converted in 2024, please followSplit-Year Backdoor Roth IRA in TurboTax, ...
A mega backdoor Roth refers to a strategy that can potentially allow some people who would be ineligible to contribute to a Roth account, based on their income or contribution limits, to transfer certain types of 401(k) contributions into a Roth—including a Roth IRA and/or Roth 401(k)....
Roth IRA Contribution Limits:For 2024 and 2025, you can contribute $7,000 yearly (or $8,000 if you are 50 or older).5 With a backdoor Roth IRA conversion, these income and contribution limits don’t apply. Benefits of a Backdoor Roth IRA ...
The backdoor IRA strategy deals with contribution limits. When you roll the money over from a Traditional to a Roth IRA, the rollover amount doesn’t count towards contribution limits.This one simple trick allows high earners to get around income limits....
There's a maximum combined contribution limit for Roth and traditional IRAs of $7,000 in 2024 and 2025 ($8,000 if age 50 and older). » Get started: See our picks for the best Roth IRA accounts. Income limits: Your annual income and filing status are factors that determine what ...
When you convert from a Traditional IRA to a Roth IRA, you will receive a 1099-R form.Complete this section only if you converted *during* 2024. If you only converted in 2025, you won’t have a 1099-R until next January. Please followSplit-Year Backdoor Roth IRA in FreeTaxUSA, Year...