Backdoor Roth
Contributing to a traditional IRA and converting it to a Roth, used by people over the Roth income limit. Watch the pro rata rule.
Where it is explained in full
Workplace plans: the 401(k), the 403(b), and the TSP, from the first paycheck to the last. Everything a person needs to open one, fill it, hold the right things in it, avoid the traps, and carry it with them when they leave. Long on purpose, so that one page is enough.
A definition says what a thing is; it never says whether it fits you. The guides explain how it works and name the professional who confirms it for a particular person. The No Advice Disclosure.
Words beside it
- Conversion (Roth)
Moving money from a traditional account to a Roth and paying tax on it now.
- Mega backdoor Roth
After tax 401(k) contributions converted to Roth, where the plan allows it. Large room, rare plans.
- Roth 401(k)
The Roth version inside a workplace plan; no income limit.
- Roth IRA
An account you fund with taxed money and withdraw from tax free later.
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