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2022 Backdoor Roth

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  • 2022 Backdoor Roth

    I know third has been beat to death. I always do my bdr on Jan 2nd. I bbb doesn't pass as is or at all by the new year do you think it's still safe to do bdr on the 2nd? Could they pass later in the year and take it away for the 22 tax year?


  • #2
    If Congress takes away the ability to do so retroactively, they will almost certainly provide a remedy for those who have already gone through the steps. However, I think this is unlikely and, if it d/n pass by 12/31, it won’t be passed retroactively. But this is just my opinion - anything can happen.
    Our passion is protecting clients and others from predatory and ignorant advisors. Fox & Co CPAs, Fox & Co Wealth Mgmt. 270-247-6087

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    • #3
      If you can do it on 1/3 then I'd go for it. I plan to do that and then whine about Vanguard's slow process.

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      • #4
        Originally posted by CordMcNally View Post
        If you can do it on 1/3 then I'd go for it. I plan to do that and then whine about Vanguard's slow process.
        Interesting issue. House, Senate and Biden pass legislation with current effective date after you started the process, but before completion.

        How long will it take for Vanguard to answer the phone?
        Government might be faster than VG.

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        • #5
          Oh, so I may want to MegaBDRoth all at once in Jan 3? Hmm... that's interesting....if I had a $58,000 paycheck too that is

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          • #6
            Was just thinking about it today . I do it in the beginning of year as well. If it has not been revoked by 2nd, will do it .

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            • #7
              Originally posted by Pmrdoc46 View Post
              I know third has been beat to death. I always do my bdr on Jan 2nd. I bbb doesn't pass as is or at all by the new year do you think it's still safe to do bdr on the 2nd? Could they pass later in the year and take it away for the 22 tax year?
              It's nice to do the BDR early in the year, but it's not strictly necessary. Why not wait until later in the year before doing it, in order to see how things shake out? Just don't wait until the very end of 2022 to do it (as others have mentioned, the process can be slow). By late spring/summer 2022 we should know if the BDR will be legal for the 2022 tax year.

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              • #8
                Originally posted by artemis View Post

                It's nice to do the BDR early in the year, but it's not strictly necessary. Why not wait until later in the year before doing it, in order to see how things shake out? Just don't wait until the very end of 2022 to do it (as others have mentioned, the process can be slow). By late spring/summer 2022 we should know if the BDR will be legal for the 2022 tax year.
                Because time in the market. Regardless, a few months likely isn't a big deal. I agree that they won't make this retroactive without a way to undo it. It's also a personal thing for me. If I have something on my To Do list, I just can't let it sit when I could be done with it and mark it off.

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                • #9
                  Originally posted by uksho View Post
                  Was just thinking about it today . I do it in the beginning of year as well. If it has not been revoked by 2nd, will do it .
                  Ditto here. No backsies congress

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                  • #10
                    This is something I've been considering regarding auto conversion of a 12/31/21 after tax 401k contribution. Decided to abort the contribution to avoid the possible headache if it ends up ineligibly converting in January.

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                    • #11
                      Isn’t it conceivable that if the bill passes in 2022, the BDRoth is prohibited for the rest of the year but reversals aren’t even required for transactions already completed?

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                      • #12
                        Originally posted by Lithium View Post
                        Isn’t it conceivable that if the bill passes in 2022, the BDRoth is prohibited for the rest of the year but reversals aren’t even required for transactions already completed?
                        No, that makes too much sense.

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                        • #13
                          Originally posted by artemis View Post

                          It's nice to do the BDR early in the year, but it's not strictly necessary. Why not wait until later in the year before doing it, in order to see how things shake out? Just don't wait until the very end of 2022 to do it (as others have mentioned, the process can be slow). By late spring/summer 2022 we should know if the BDR will be legal for the 2022 tax year.
                          Yea I like to get the money working asap. I use Fidelity process is very quick

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                          • #14
                            Originally posted by CordMcNally View Post

                            Because time in the market. Regardless, a few months likely isn't a big deal. I agree that they won't make this retroactive without a way to undo it. It's also a personal thing for me. If I have something on my To Do list, I just can't let it sit when I could be done with it and mark it off.
                            Same here , will like to get the i bond done as well,

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                            • #15
                              Make no mistake, everyone is speculating. The way things are going, there is absolutely no rules or logic. There is no requirement that logic or fairness make any sense of be fair. Whatever they pass (is anything at all), warts and laws and mistakes have no requirement to be fair. All that is needed is ONE vote to gum up the works and make sure someone gets screwed. What we agree makes sense only requires one vote to upset the apple cart.

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