Bill proposed to crack down on backdoor roth (and other loopholes)

[Anonymous]

Anonymous wrote:So is this pretty much set for this year? Or is there still a round of edits? Just curious if it’s settled

All IRA changes were stripped out of the bill. A lot of these proposals were dead on arrival anyway.

[Anonymous]

Anonymous wrote:

Anonymous wrote:So is this pretty much set for this year? Or is there still a round of edits? Just curious if it’s settled

All IRA changes were stripped out of the bill. A lot of these proposals were dead on arrival anyway.

And now some are back, including killing the roth IRA, but not the ones about holding "investor class' stocks (i.e. how Peter Roth actually got a huge IRA).

[Anonymous]

Yeah killing the backdoor Roth IRA, which people at income levels of 140 single / 208 married use, was reintroduced when they added in the SALT, which ... is best used by people far higher income than that. Annoyed AF.

[Anonymous]

Ugh is killing the megabackdoor also back?

[Anonymous]

Anonymous wrote:Ugh is killing the megabackdoor also back?

Yes. All backdoors proposed to close. If you have reps, write them.

[Anonymous]

Anonymous wrote:

Anonymous wrote:Ugh is killing the megabackdoor also back?

Yes. All backdoors proposed to close. If you have reps, write them.

Really? Even though I use a backdoor Roth, as someone with a HHI of $400K, I would be completely embarrassed to write a rep. It's just very poor taste for high income people to be writing a rep about something like this. I'd be more inclined to donate $6000 to charity than to write a rep. At a certain income level, you just put the $6000 in a brokerage account instead and be thankful you have it. Some of you people really are unbelievable.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Ugh is killing the megabackdoor also back?

Yes. All backdoors proposed to close. If you have reps, write them.

Really? Even though I use a backdoor Roth, as someone with a HHI of $400K, I would be completely embarrassed to write a rep. It's just very poor taste for high income people to be writing a rep about something like this. I'd be more inclined to donate $6000 to charity than to write a rep. At a certain income level, you just put the $6000 in a brokerage account instead and be thankful you have it. Some of you people really are unbelievable.

You sound poor.

[Anonymous]

This passes and Roths in general will be on the chopping block. I’m not supporting a tax savings vehicle that doesn’t help me.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Ugh is killing the megabackdoor also back?

Yes. All backdoors proposed to close. If you have reps, write them.

Really? Even though I use a backdoor Roth, as someone with a HHI of $400K, I would be completely embarrassed to write a rep. It's just very poor taste for high income people to be writing a rep about something like this. I'd be more inclined to donate $6000 to charity than to write a rep. At a certain income level, you just put the $6000 in a brokerage account instead and be thankful you have it. Some of you people really are unbelievable.

Agree. Only thing is the very wealthy aren't shy about wielding their power to maintain their loop holes...

But no, i won't be writing my reps about this.

[Anonymous]

Anonymous wrote:Yeah killing the backdoor Roth IRA, which people at income levels of 140 single / 208 married use, was reintroduced when they added in the SALT, which ... is best used by people far higher income than that. Annoyed AF.

I would get a pretty good benefit from the SALT coming back, but long term, I'm really going to miss the back door roths....

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Ugh is killing the megabackdoor also back?

Yes. All backdoors proposed to close. If you have reps, write them.

Really? Even though I use a backdoor Roth, as someone with a HHI of $400K, I would be completely embarrassed to write a rep. It's just very poor taste for high income people to be writing a rep about something like this. I'd be more inclined to donate $6000 to charity than to write a rep. At a certain income level, you just put the $6000 in a brokerage account instead and be thankful you have it. Some of you people really are unbelievable.

Good for you. We are dual income with a HHI of <250K and do not feel embarrassed at all to express our anger at the broken campaign promise.

[Anonymous]

I will add that the back door changes were added as a pay for for the SALT cap going to 72,500 or 80,000. People who benefit most from that earn two to three times as much as we do. So it’s broken campaign promises plus our retirement saving will be that much harder… to fund a tax break for people higher income than us? F that. That’s not OK.

[Anonymous]

Anonymous wrote:I will add that the back door changes were added as a pay for for the SALT cap going to 72,500 or 80,000. People who benefit most from that earn two to three times as much as we do. So it’s broken campaign promises plus our retirement saving will be that much harder… to fund a tax break for people higher income than us? F that. That’s not OK.

I get your anger about the SALT, for sure. Concur that if you chose one or the other, you keep the backdoor roths (or hey, just RAISE the roth limit and get rid of this "backdoor" nonsense only available to those in the know). I don't think it was a simple horse trade like that, only some random posters here have claimed as much. The roth restrictions were out in the "framework", which was not very detailed anyway. It is not surprise they are back. The SALT thing is a separate (and costly) issue, but is targeted at undoing the attack the TCJA took at blue states. I'm really undecided if the SALT deduction is good policy or not at a macro level, I'm not informed enough to have an opinion beyond that it seems like a tax break for the well off, yet only because those people are funding state/local affairs. My only point is that linking the two issues is not sensible.

The backdoor roth is an OBVIOUS LOOPHOLE, and we all knew it, and it was a great loophole.

I disagree with the characterization that your taxes are being raised by this, but also understand why you say that.

Speaking of anger about funding tax breaks for higher income / wealth people, why is this stepped up basis stuff such a third rail?

[Anonymous]

Anonymous wrote:This passes and Roths in general will be on the chopping block. I’m not supporting a tax savings vehicle that doesn’t help me.

Why doesn’t a Roth help you?

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Ugh is killing the megabackdoor also back?

Yes. All backdoors proposed to close. If you have reps, write them.

Really? Even though I use a backdoor Roth, as someone with a HHI of $400K, I would be completely embarrassed to write a rep. It's just very poor taste for high income people to be writing a rep about something like this. I'd be more inclined to donate $6000 to charity than to write a rep. At a certain income level, you just put the $6000 in a brokerage account instead and be thankful you have it. Some of you people really are unbelievable.

Good for you. We are dual income with a HHI of <250K and do not feel embarrassed at all to express our anger at the broken campaign promise.

You are in the top 10% of income at least. You are not owed a backdoor Roth.