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How does ROTH 403(b) contribution effect ROTH contribution?

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  • How does ROTH 403(b) contribution effect ROTH contribution?

    How does ROTH 403(b) contribution effect ROTH contribution?

    For context. I am 34 y/o just graduated residency and am starting fellowship this year. My previous employer offer a 403(b) retirement plan which allow both pre and post tax contribution. I am transferring the pre tax money into a Fidelity IRA and the post tax into a Fidelity ROTH. For this tax year I contributed about $1500 to the post tax 403(b).

    I would like to max out my ROTH contributions this year before I have to start using the back door. My question is how much am I able to contribute to my ROTH. Is it $6000 minus $1500 (the post tax amount I contributed to the 403(b) this tax year) or am I allowed to contribute the full $6000? I received different answers from customer support at Empower and Fidelity.

    Thank you in advance.

  • #2
    $6000

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    • #3
      Full $6000. Unrelated to your 403(b).

      Consider converting the pre-tax IRA full amount this year as well, or you will pay pro-rata tax on your backdoor Roth IRA.

      Conversion and contribution are completely separate things.

      Roth is an eponym not an acronym.

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      • #4
        Learn something new every day. The definition not the fact.

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        • #5
          “I am transferring the pre tax money into a Fidelity IRA and the post tax into a Fidelity ROTH.”
          Both pretax and post tax can be a trustee to trustee rollover . Both "should" go to roth, you will owe tax on the pretax but this is the lowest rate you will be in years. If you rollover to the t-IRA, consider converting it before 12/31. (income from 1/2 residency and 1/2 fellowship is a great window for your top marginal rate).

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          • #6
            Roth is an adjective, and can apply to several different accounts. So "a Roth" is not a thing, but a Roth IRA is. I'm not trying to be pedantic, the distinction is important. It also immediately answers your question, if you know that IRA contribution limits are separate from employer retirement plans.

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            • #7
              not to be pedantic, but isn't Roth a noun? The Roth IRA is derived from the senator who created the concept in the tax code, William Roth of Delaware

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              • #8
                Yes, it is a proper noun in that it is a name just like any other (William Roth), and also in that is a specific entity when used in its full legal form, “Roth Individual Retirement Arrangement (IRA).”

                It can also function as an adjective (in common usage) when used to modify another noun, such as in “I filled up all my Roth space this year.”

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                • #9
                  Originally posted by bovie View Post
                  Yes, it is a proper noun in that it is a name just like any other (William Roth), and also in that is a specific entity when used in its full legal form, “Roth Individual Retirement Arrangement (IRA).”

                  It can also function as an adjective (in common usage) when used to modify another noun, such as in “I filled up all my Roth space this year.”
                  Or a verb!: I'm totally going to BDRoth that money on Jan 2nd.

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                  • #10
                    Originally posted by JBME View Post
                    not to be pedantic, but isn't Roth a noun? The Roth IRA is derived from the senator who created the concept in the tax code, William Roth of Delaware
                    Yes, I it could be used as a noun if you're talking about a person. But in the personal finance community it's almost always used as an adjective, to describe the account type, i.e. Roth IRA vs. Traditional IRA.
                    My point was less about grammar, and more that "a Roth" doesn't tell us which account they are actually talking about.

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