Another Roth Question

[Gearhead Jim]

...
You will see some concerns about the possibility of changes in the tax laws which could cause your ROTH to be taxed twice, but I'm of the opinion the risk of that is reasonably small.
...

Most people, when they talk about future tax changes, speculate about various ways that taxes will likely rise; but i haven't heard anyone talking about double taxation of Roths. Can you elaborate?
Thanks.

 

[jdw_fire]

Most people, when they talk about future tax changes, speculate about various ways that taxes will likely rise; but i haven't heard anyone talking about double taxation of Roths. Can you elaborate?
Thanks.

The talk of double taxation of a Roth comes from speculation that in the future the US tax code will be changed so that you are taxed on WDs from Roth IRAs.

 

[Gearhead Jim]

Wow, that would really be a low blow. I didn't think that even Congress could be that foul, but I've been wrong before.

 

[uncledrz]

Has anyone identified any good papers on Roth IRA strategies? I am interested in learning more about conversions from Trad IRA and 401ks to Roth with an eye on reduced taxes.

try the fairmark site
http://fairmark.com/rothira/decide.htm

Tio z

 

[teejayevans]

Wow, that would really be a low blow. I didn't think that even Congress could be that foul, but I've been wrong before.

I doubt it, can anyone name an instance where the rules were change and existing
investments were not grandfathered in?

Most likely is will be in the form of a catch-all tax like AMT will indirectly tax your roth
income. And there will be plenty of warning, so you will see a massive pull out of roths
if this should ever occur.
Tom

 

[FIRE'd@51]

I doubt it, can anyone name an instance where the rules were change and existing
investments were not grandfathered in?

Yep, in 1993 Clinton raised the amount of SS benefits subject to taxation from 50% to 85%, depending upon your income. No one was grandfathered out. Remember, you pay SS taxes with after-tax dollars too.

Most likely is will be in the form of a catch-all tax like AMT will indirectly tax your roth
income.

I agree it would be more likely to be done this way, but the results could be just as onerous.