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Backdoor Roth

“But can’t fund a Roth IRA, I make too much,” or so goes the common objection. And that is partially true. There is a law in the tax code that says once you make a certain amount of money, you are no longer allowed to fund a Roth IRA. At least not directly. The crazy thing is though, the same government has written into the same tax code a way around that obstacle. Specifically, it’s called the backdoor Roth IRA conversion. That’s a big long financial jargon for “yes it’s possible”.

As with anything in the tax code, this is not necessarily a simple process, but we help you take the complexity out of it. If you want to learn more, give us a call.


Any opinions are those of Tim Weddle and not necessarily those of Raymond James. Investing involves risk and you may incur a profit or loss regardless of strategy selected. Past performance does not guarantee future results. Raymond James and its advisors do not offer tax or legal advice. You should discuss any tax or legal matters with the appropriate professional. Like Traditional IRAs, contribution limits apply to Roth IRAs. In addition, with a Roth IRA, your allowable contribution may be reduced or eliminated if your annual income exceeds certain limits. Contributions to a Roth IRA are never tax deductible, but if certain conditions are met, distributions will be completely income tax free. Every investor’s situation is unique, and you should consider your investment goals, risk tolerance and time horizons before making any investment. Prior to making an investment decision, please consult with your financial advisor about your individual situation.