Infrastructure bill: what happened to mega backdoor Roth?

[aifirst]

With the infrastructure bill finally signed into law, what is the status of backdoor mega backdoor Roth IRA? I read reports that they survived till 2028. Is that correct? Or no more Roth conversions starting tax year 2022?

[GasFIRE]

That hasn’t been determined yet. Provisions eliminating after-tax contributions are contained in Biden’s BBB legislation which is different from the infrastructure bill and so far hasn’t been passed by Congress.

[NationalPark]

I haven’t heard about it in news articles recently, so maybe that got thrown out with the increase in too marginal rate (?)

[JBME]

GasFIRE has the right answer

[Molar Mechanic]

Nothing passed so far. Democrats are in disarray. Progressives in Congress put some things in that are unlikely to pass moderates in the Senate. Unsure if progressives will vote for a bill without them.

They are waiting on a score from the CBO that says it will be deficit neutral.

The bulk of the current bill is probably not going to change ***assuming it passes at all***. Assume all "back-door" IRA strategies to be dead. No change in cap gains tax.

[Kamban]

I think megabackdoor Roth may or may not pass, but if it passes it will be effective from 2022.

So if one is on the fence about Roth conversion, this is the year to do it.

[NationalPark]

Sounds like will be increase in SALT cap to about $72k to get moderate NY/NJ/CA house dems on board. Then Bernie will put an income cap of $400k in Senate.

[JBME]

Sounds like will be increase in SALT cap to about $72k to get moderate NY/NJ/CA house dems on board. Then Bernie will put an income cap of $400k in Senate.

it's nearly impossible to predict what is going to happen at this point.

[CordMcNally]

Nothing passed so far. Democrats are in disarray. Progressives in Congress put some things in that are unlikely to pass moderates in the Senate. Unsure if progressives will vote for a bill without them.

Just when you think the two parties couldn't be further apart there's now intraparty fighting. I wouldn't be surprised if we see some of the more progressive Dems teaming up with some Repubs.

They are waiting on a score from the CBO that says it will be deficit neutral.

They're going to be waiting a long time if they want it to be deficit neutral despite what anyone touting the legislation says.

[aifirst]

Thanks everyone. If the Roth IRA goes away together with SALT cap restricted at 400K, it will be a rough deal for high income earners

[JBME]

from what I can gather from what passed the House this morning, the backdoor Roth and megabackdoor Roth are still very much alive. Also the SALT deduction limitation went from $10k to $80k.

The Senate still needs to pass it. I suspect the Senate version will be quite a bit different. I'm actually unsure if it will pass in any form. More likely than not something will pass but no guarantee. Then it'll have to go to conference committee and both houses will need to vote on the compromise again. We're still quite a ways away but it did progress this morning.