Roth IRA income limits

[Beerbrat]

Say you don't expect to be over but then fall into some income, how do you rectify the Roth account when this happens?

It's a pretty common thing that happens. I use Vanguard so I'm linking their FAQs on it, but you can remove the excess. They will calculate any gains you made on the amount that now becomes taxable. You can move it to an IRA and then backdoor the excess if that is an option also.

Removing excess contributions from your IRA | Vanguard

Learn about excess IRA contributions with Vanguard. Understand how to identify, correct, and avoid penalties to protect your retirement savings.

investor.vanguard.com

 

[wxman1]

"The income phase-out range for taxpayers making contributions to a Roth IRA is $125,000 to $140,000 for singles and heads of household, up from $124,000 to $139,000. For married couples filing jointly, the income phase-out range is $198,000 to $208,000, up from $196,000 to $206,000. The phase-out range for a married individual filing a separate return who makes contributions to a Roth IRA is not subject to an annual cost-of-living adjustment and remains $0 to $10,000."

https://www.irs.gov/newsroom/income-ranges-for-determining-ira-eligibility-change-for-2021

Blew by that myself and that is before you count my ER doctor wife.

Not bad for a history major.

My wife currently works as a scribe for an ER Doc and she was once telling her what she paid in taxes. My was pretty much the "Help me I'm poor GIF". Tremendous experience though.

 

[NATEizKING]

It's a pretty common thing that happens. I use Vanguard so I'm linking their FAQs on it, but you can remove the excess. They will calculate any gains you made on the amount that now becomes taxable. You can move it to an IRA and then backdoor the excess if that is an option also.

Removing excess contributions from your IRA | Vanguard

Learn about excess IRA contributions with Vanguard. Understand how to identify, correct, and avoid penalties to protect your retirement savings.

investor.vanguard.com

I hope to be so lucky, thanks

 

[Sigmapolis]

My wife currently works as a scribe for an ER Doc and she was once telling her what she paid in taxes. My was pretty much the "Help me I'm poor GIF". Tremendous experience though.

My wife and I paid $44,846 in federal income taxes last year.

That's over 30% more than I made my first year with a real job -- before taxes.

And that is going to go way up when she gets a real attending job here soon (next June) and goes from making roughly $60,000 per year into the range of $150,000 to $250,000 per year.

Cue the Talking Heads trailer music.

 

[BCClone]

All this backdoor talk and no one has made a joke yet?

Thought I did about Nikki Minaj.

 

[BCClone]

My wife and I paid $44,846 in federal income taxes last year.

That's over 30% more than I made my first year with a real job -- before taxes.

And that is going to go way up when she gets a real attending job here soon (next June) and goes from making roughly $60,000 per year into the range of $150,000 to $250,000 per year.

Cue the Talking Heads trailer music.

Need to start a small business so you can deduct.

 

[VeloClone]

@VeloClone curious why my post was funny? Because I have a Roth IRA or because I am telling him to look into what it's all about?

I just thought it was funny that you thought wxman was serious.

 

[srjclone]

I just thought it was funny that you thought wxman was serious.

I don't run in you older folks' circles, thought he was an actually curious millennial because god knows I didn't remember **** about Roth IRAs from that one week in accounting class jr year of HS hahah

That's on me for thinking someone is being genuine on CF

 

[VeloClone]

Wow, Dana really let himself go...

 

[wxman1]

I don't run in you older folks' circles, thought he was an actually curious millennial because god knows I didn't remember **** about Roth IRAs from that one week in accounting class jr year of HS hahah

That's on me for thinking someone is being genuine on CF

I may be a dumb pilot and program manager type (I have worked with engineers long enough to know what they think of me) but I know all about dat IRA stuff. Just being another smartass millenial on the interwebs.

 

[BCClone]

I may be a dumb pilot and program manager type (I have worked with engineers long enough to know what they think of me) but I know all about dat IRA stuff. Just being another smartass millenial on the interwebs.

Go eat your tide pod and stop harassing the boomers.

 

[DeereClone]

Thought I did about Nikki Minaj.

yeah with no responses, must have been a bum joke.

 

[NWICY]

If I spend my money on hookers and blow, can I deduct the amount of coke the hooker used as a business expense?

Seems legit.

 

[NWICY]

All this backdoor talk and no one has made a joke yet?

BC had one about Nikki Minaj. .

 

[MuskieCy]

If I spend my money on hookers and blow, can I deduct the amount of coke the hooker used as a business expense?

Only if the hooker is your employee.

Otherwise, the hooker would have include your coke expense as a taxable benefit.

 

[ISUCyclones2015]

Imagine being poor and not dealing with this

My company offers the mega backdoor and its pretty awesome.

 

[srjclone]

 

[Gunnerclone]

All this backdoor talk and no one has made a joke yet?

In a twisted quirk of science, it’s always messier going out the back door than going in to it.