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Old 11-21-2014, 03:25 PM   #41
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Originally Posted by Gumby View Post
Easier said than done. The people who take advantage of these things have the incentive, the money and consequently the ear of congress critters to fight any such change.
If I had enough money I wouldn't mind a necklace of congressmen's ears.

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Old 11-21-2014, 03:40 PM   #42
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Originally Posted by Fermion View Post
They might limit the mega backdoor Roth IRA thing some of us are now doing (shoveling $25,000 to $30,000 into a Roth tax free every year) but I doubt they would ever change the way the Roth works on distribution (tax free)......
Is that accurate? I thought you paid the tax up front at the time of the conversion.

...with no reasonable expectation for ER, I'm just here auditing the AP class.Retired 8/1/15.
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Old 11-21-2014, 03:51 PM   #43
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Originally Posted by jazz4cash View Post
Is that accurate? I thought you paid the tax up front at the time of the conversion.
You pay tax on any gains, but it is called an in plan conversion and you pretty much pay no tax (note the money goes into the 401k after tax so there was tax paid at some point).

Essentially it is like this:

Normal folks: $17,500 into 401K, $5500 into Roth

Lucky folks: $17,500 into 401K, $20,000 or more into 401K after tax -> immediately converted to Roth, $5500 into Roth.

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