The Back Door Roth IRA

<p>You're listening to making smart decisions with Josh Tirado. Today's topic is the backdoor Roth IRA. In the last year to the backdoor Roth IRA, concept has gained popularity. If you Google it, you will find a number of articles online, explaining and detailing the backdoor Roth IRA. And also a lot of times it's.</p><p><br></p><p>[00:02:04] Heavily sprinkled with the author's opinion on the strategy. So I want to talk today about some of the rules concerning the backdoor Roth IRA, how you could utilize it. If it's something that is for you or not, and what you want to consider. First and foremost, let me say that consulting with your professional.</p><p>[00:02:23] When it comes to the tour Roth IRA, whether using a backdoor Roth IRA or doing some sort of Roth IRA conversion, you definitely have to speak with your professional because we have software. We can run multiple scenarios and compare and contrast and see if this is the right strategy for you. For some people, it's a home run. For some people, it should really be a no go.</p><p>[00:02:44] And there is a large amount of a gray area. But a lot of it's dependent upon your strategy. And what I don't like is a lot of the articles I'm finding online concerning the backdoor Roth IRA concept, as I said before, heavily influenced by the author's opinion and a lot of the opinions for or against the concept.</p><p>[00:03:02] Are based on some outlier factors and really what would not have applied to the majority of people out there, but what would apply to the minority. So they're looking more for the exception than the rule. the Roth IRA, there are some limitations to contribute to a Roth IRA.</p><p>[00:03:21] There is an income limitation. </p><p>[00:03:23]For instance, in 2019, if you are a single head of household person filing your taxes. If you make less than 122,000 modified adjusted gross income, you can contribute a maximum of $6,000 a year to Roth IRA. If you're age 50 or older, you can contribute $7,000. That's been adjusted in the year 2020. Y