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Roth

A Better Way of Understanding the Once-Per-Year Rollover Rule

Monday, May 22, 2023
The “once-per-year” rollover rule is one of those IRA rules that has serious tax consequences and cannot be fixed if violated. Breaking the rule results in a taxable distribution and a 10% early distribution penalty if you’re under age 59 ½. Plus, any rolled over funds are considered excess IRA contributions that are subject to a 6% annual penalty unless timely corrected.
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Mandatory Roth Catch-up Contributions Required for 2024

Wednesday, May 10, 2023
One of the more controversial provisions of the new SECURE 2.0 law concerns 401(k) catch-up contributions. Most 401(k) plans – as well as 403(b) and governmental 457(b) plans – permit employees who are age 50 or older to make catch-up contributions. The limit for catch-ups in 2023 is $7,500, allowing for total elective deferrals of up to $30,000.
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Transferring a Roth IRA After Divorce – 3 Logical Considerations

Wednesday, February 17, 2021
Surprisingly, the rules governing what happens when an ex-spouse acquires a Roth IRA after divorce are unclear. There are no specific directions in the Tax Code or in the regulations. However, there is definitive guidance for a spouse who inherits a Roth IRA due to death. It makes sense to look to these rules after death for direction on how to process a Roth IRA transfer after a divorce. Of course, with no definitive route, this is only speculation until the IRS provides a roadmap.
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QCDs and Roth Conversions: Today's Slott Report Mailbag

Thursday, September 12, 2019
Question: Hello, I’ve been a follower of Ed’s expertise for over 10 years. The information has always been helpful and clearly explained. At this time, I’m looking to help a client minimize her taxes. She recently inherited an IRA from her father. She has taken the “Stretch IRA” option and is now receiving her required distributions. Can she utilize a Qualified Charitable Distribution to her church (verified 501c3) to reduce her tax liability and still maintain the stretch IRA? Answer: Yes. Qualified Charitable Distributions (QCDs) are available to beneficiaries.
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The Time Machine

Wednesday, June 12, 2019
A time machine would be cool to have. Even if it only worked on financial assets, it sure would come in handy. One might jump into the future and see if an investment paid off, or you could look around to see where the smart money succeeded. And if the original investment turned out to be a loser, you could go back in time and sell it – or never even buy it in the first place. Too bad financial time machines don’t exist. Bummer. While literal time machines have yet to be invented and we can’t quantum leap,
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Roth IRAs and the 5-Year Rules

Wednesday, September 12, 2018
We constantly see questions regarding the distribution rules for Roth IRAs. Personally, I’ve always thought that the failure to understand these rules prevents many from truly appreciating the benefits of these accounts.
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Converting After-Tax Contributions and Aggregating RMDs: Today’s Q&A Mailbag

Thursday, February 15, 2018
This week's Slott Report Mailbag answers readers' questions about avoiding converting after-tax contributions to a Roth IRA and aggregating RMDs.
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Roth Recharacterization Update from IRS

Wednesday, January 24, 2018
It has been widely reported that the Tax Cuts and Jobs Act eliminated the ability to recharacterize Roth IRA conversions as of January 1, 2018. On the other hand, it kept the ability to recharacterize IRA and Roth IRA contributions. Despite all of the above, an unanswered question on Roth IRA conversions done in 2017 lingered. At the time of those conversions the taxpayer had the ability to recharacterize the conversion up to October 15, 2018. Was that option still available to them?
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QCDs and Roth Conversions: Today’s Q&A Mailbag

Thursday, December 14, 2017
This week's Slott Report Mailbag answers readers' questions about QCDs and basis from a Roth conversion.
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Last Minute IRA Contribution Advice

Wednesday, April 12, 2017
The 2016 tax-filing deadline is upon us. Are you considering making a 2016 IRA contribution? It’s not too late, but time is quickly running out. Here are some quick words of last minute advice to keep in mind as you make your contribution.
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