It looks like the Amazon 401k plan at Fidelity limits the after-tax non-ROTH contribution to 10% of base salary. It has only been since 2014 with the merger of MAPMG that TPMG has Roth 401k, to satisfy the non-discrimination rule. In a mega backdoor Roth, people who have a 401k that allows after-tax contributions. Hey everyone, I want to clarify how to actually do the mega backdoor roth with fidelity. We also fill out all of the applicable Fidelity Investment brokerage forms in order to open the correct voluntary after-tax brokerage account for the solo 401k. « on: December 05, 2020, 06:55:28 PM » According to the plan documents DW’s plan allows in-service rollovers to a Roth for after-tax contribution accounts. /*# sourceMappingURL=https://www.redditstatic.com/desktop2x/chunkCSS/TopicLinksContainer.361933014be843c79476.css.map*/._2ppRhKEnnVueVHY_G-Ursy{-ms-flex-align:center;align-items:center;display:-ms-flexbox;display:flex;margin:22px 0 0;min-height:200px;overflow:hidden;position:relative}._2KLA5wMaJBHg0K2z1q0ci_{margin:0 -7px -8px}._1zdLtEEpuWI_Pnujn1lMF2{bottom:0;position:absolute;right:52px}._3s18OZ_KPHs2Ei416c7Q1l{margin:0 0 22px;position:relative}.LJjFa8EhquYX8xsTnb9n-{filter:grayscale(40%);position:absolute;top:11px}._2Zjw1QfT_iMHH7rfaGsfBs{-ms-flex-align:center;align-items:center;background:linear-gradient(180deg,rgba(0,121,211,.24),rgba(0,121,211,.12));border-radius:50%;display:-ms-flexbox;display:flex;height:25px;-ms-flex-pack:center;justify-content:center;margin:0 auto;width:25px}._2gaJVJ6_j7vwKV945EABN9{background-color:var(--newCommunityTheme-button);border-radius:50%;height:15px;width:15px;z-index:1} That includes traditional IRA, SEP IRA, and Simple IRA. ._12xlue8dQ1odPw1J81FIGQ{display:inline-block;vertical-align:middle} With a mega backdoor Roth IRA, high-income people can contribute up to $37,000 to a Roth. For us the mega backdoor roth is a feature of the company saving plan, it is just an election you can choose. The math behind the Microsoft Mega Backdoor Roth Conversion 2020. There should be no additional fees or charges when spouses participate in the same Solo 401k plan. While Fidelity Investments does not offer a solo 401k that allows for voluntary after-tax contributions, which is the first step in implementing the “mega back door Roth solo 401k strategy, “Fidelity does offer a custodial brokerage account to hold the voluntary after-tax solo 401k funds for a solo 401k plan provided by a solo 401k provider such as My Solo 401k Financial. Before we dive in, I’ll remind you that I am a doctor, not an attorney or accountant. When you file and have an AGI of less than $124k, you can contribute the full $6k directly to a Roth … In other words, they let you take out the non-Roth after-tax money and its earnings to a Roth IRA while you still work for the employer. ._3Im6OD67aKo33nql4FpSp_{border:1px solid var(--newCommunityTheme-widgetColors-sidebarWidgetBorderColor);border-radius:5px 5px 4px 4px;overflow:visible;word-wrap:break-word;background-color:var(--newCommunityTheme-body);padding:12px}.lnK0-OzG7nLFydTWuXGcY{font-size:10px;font-weight:700;letter-spacing:.5px;line-height:12px;text-transform:uppercase;padding-bottom:4px;color:var(--newCommunityTheme-navIcon)} Last time I did this, they're didn't have the automation and it was a $40 service fee to do the in-service withdrawal and conversion. Microsoft 401k Mega Backdoor Roth Conversion The Microsoft employee benefits offering has some great options for employees. Are the automatic conversations free? It’s worth clarifying for those considering this that there are generally 2 options: In-Plan Roth conversion - money is converted from after tax to Roth inside the plan, IRA Roth conversion - same idea but the money goes into a Roth IRA, In-plan Roth conversion is good if you have a good plan with solid investments and low fees, and you don’t have to worry about opening and maintaining the Roth IRA. .Rd5g7JmL4Fdk-aZi1-U_V{transition:all .1s linear 0s}._2TMXtA984ePtHXMkOpHNQm{font-size:16px;font-weight:500;line-height:20px;margin-bottom:4px}.CneW1mCG4WJXxJbZl5tzH{border-top:1px solid var(--newRedditTheme-line);margin-top:16px;padding-top:16px}._11ARF4IQO4h3HeKPpPg0xb{transition:all .1s linear 0s;display:none;fill:var(--newCommunityTheme-button);height:16px;width:16px;vertical-align:middle;margin-bottom:2px;margin-left:4px;cursor:pointer}._1I3N-uBrbZH-ywcmCnwv_B:hover ._11ARF4IQO4h3HeKPpPg0xb{display:inline-block}._2IvhQwkgv_7K0Q3R0695Cs{border-radius:4px;border:1px solid var(--newCommunityTheme-line)}._2IvhQwkgv_7K0Q3R0695Cs:focus{outline:none}._1I3N-uBrbZH-ywcmCnwv_B{transition:all .1s linear 0s;border-radius:4px;border:1px solid var(--newCommunityTheme-line)}._1I3N-uBrbZH-ywcmCnwv_B:focus{outline:none}._1I3N-uBrbZH-ywcmCnwv_B.IeceazVNz_gGZfKXub0ak,._1I3N-uBrbZH-ywcmCnwv_B:hover{border:1px solid var(--newCommunityTheme-button)}._35hmSCjPO8OEezK36eUXpk._35hmSCjPO8OEezK36eUXpk._35hmSCjPO8OEezK36eUXpk{margin-top:25px;left:-9px}._3aEIeAgUy9VfJyRPljMNJP._3aEIeAgUy9VfJyRPljMNJP._3aEIeAgUy9VfJyRPljMNJP,._3aEIeAgUy9VfJyRPljMNJP._3aEIeAgUy9VfJyRPljMNJP._3aEIeAgUy9VfJyRPljMNJP:focus-within,._3aEIeAgUy9VfJyRPljMNJP._3aEIeAgUy9VfJyRPljMNJP._3aEIeAgUy9VfJyRPljMNJP:hover{transition:all .1s linear 0s;border:none;padding:8px 8px 0}._25yWxLGH4C6j26OKFx8kD5{display:inline}._2YsVWIEj0doZMxreeY6iDG{font-size:12px;font-weight:400;line-height:16px;color:var(--newCommunityTheme-metaText);display:-ms-flexbox;display:flex;padding:4px 6px}._1hFCAcL4_gkyWN0KM96zgg{color:var(--newCommunityTheme-button);margin-right:8px;margin-left:auto;color:var(--newCommunityTheme-errorText)}._1hFCAcL4_gkyWN0KM96zgg,._1dF0IdghIrnqkJiUxfswxd{font-size:12px;font-weight:700;line-height:16px;cursor:pointer;-ms-flex-item-align:end;align-self:flex-end;-webkit-user-select:none;-ms-user-select:none;user-select:none}._1dF0IdghIrnqkJiUxfswxd{color:var(--newCommunityTheme-button)}._3VGrhUu842I3acqBMCoSAq{font-weight:700;color:#ff4500;text-transform:uppercase;margin-right:4px}._3VGrhUu842I3acqBMCoSAq,.edyFgPHILhf5OLH2vk-tk{font-size:12px;line-height:16px}.edyFgPHILhf5OLH2vk-tk{font-weight:400;-ms-flex-preferred-size:100%;flex-basis:100%;margin-bottom:4px;color:var(--newCommunityTheme-metaText)}._19lMIGqzfTPVY3ssqTiZSX._19lMIGqzfTPVY3ssqTiZSX._19lMIGqzfTPVY3ssqTiZSX{margin-top:6px}._19lMIGqzfTPVY3ssqTiZSX._19lMIGqzfTPVY3ssqTiZSX._19lMIGqzfTPVY3ssqTiZSX._3MAHaXXXXi9Xrmc_oMPTdP{margin-top:4px} The Mega Conversion Backdoor Roth, as Larry puts it, as I like to call it the Barndoor, that’s when you utilize the full defined contribution limits. As of 2020, if you are under 50, you can contribute $19,500 to your 401k. (Read 671 times) Steeze. On top of this, if employers allow, you can do the mega backdoor roth which is what this post is about. In Northern California TPMG and NWP the physician groups have Fidelity and the HealthPlan non-physicians, Vanguard. The balances have to be $0.00. Since the start of the year, I've had ZERO taxable growth on my after-tax contributions prior to them being rolled over into my Roth 401k. ._1zyZUfB30L-DDI98CCLJlQ{border:1px solid transparent;display:block;padding:0 16px;width:100%;border:1px solid var(--newCommunityTheme-body);border-radius:4px;box-sizing:border-box}._1zyZUfB30L-DDI98CCLJlQ:hover{background-color:var(--newCommunityTheme-primaryButtonTintedEighty)}._1zyZUfB30L-DDI98CCLJlQ._2FebEA49ReODemDlwzYHSR,._1zyZUfB30L-DDI98CCLJlQ:active,._1zyZUfB30L-DDI98CCLJlQ:hover{color:var(--newCommunityTheme-bodyText);fill:var(--newCommunityTheme-bodyText)}._1zyZUfB30L-DDI98CCLJlQ._2FebEA49ReODemDlwzYHSR,._1zyZUfB30L-DDI98CCLJlQ:active{background-color:var(--newCommunityTheme-primaryButtonShadedEighty)}._1zyZUfB30L-DDI98CCLJlQ:disabled,._1zyZUfB30L-DDI98CCLJlQ[data-disabled],._1zyZUfB30L-DDI98CCLJlQ[disabled]{background-color:var(--newCommunityTheme-primaryButtonTintedFifty);color:rgba(var(--newCommunityTheme-bodyText),.5);fill:rgba(var(--newCommunityTheme-bodyText),.5);cursor:not-allowed}._1zyZUfB30L-DDI98CCLJlQ:active,._1zyZUfB30L-DDI98CCLJlQ:disabled,._1zyZUfB30L-DDI98CCLJlQ:hover,._1zyZUfB30L-DDI98CCLJlQ[data-disabled],._1zyZUfB30L-DDI98CCLJlQ[disabled]{border:1px solid var(--newCommunityTheme-body)}._1O2i-ToERP3a0i4GSL0QwU,._1uBzAtenMgErKev3G7oXru{display:block;fill:var(--newCommunityTheme-body);height:22px;width:22px}._1O2i-ToERP3a0i4GSL0QwU._2ilDLNSvkCHD3Cs9duy9Q_,._1uBzAtenMgErKev3G7oXru._2ilDLNSvkCHD3Cs9duy9Q_{height:14px;width:14px}._2kBlhw4LJXNnk73IJcwWsT,._1kRJoT0CagEmHsFjl2VT4R{height:24px;padding:0;width:24px}._2kBlhw4LJXNnk73IJcwWsT._2ilDLNSvkCHD3Cs9duy9Q_,._1kRJoT0CagEmHsFjl2VT4R._2ilDLNSvkCHD3Cs9duy9Q_{height:14px;width:14px}._3VgTjAJVNNV7jzlnwY-OFY{font-size:14px;line-height:32px;padding:0 16px}._3VgTjAJVNNV7jzlnwY-OFY,._3VgTjAJVNNV7jzlnwY-OFY._2ilDLNSvkCHD3Cs9duy9Q_{font-weight:700;letter-spacing:.5px;text-transform:uppercase}._3VgTjAJVNNV7jzlnwY-OFY._2ilDLNSvkCHD3Cs9duy9Q_{font-size:12px;line-height:24px;padding:4px 9px 2px;width:100%}._2QmHYFeMADTpuXJtd36LQs{font-size:14px;line-height:32px;padding:0 16px}._2QmHYFeMADTpuXJtd36LQs,._2QmHYFeMADTpuXJtd36LQs._2ilDLNSvkCHD3Cs9duy9Q_{font-weight:700;letter-spacing:.5px;text-transform:uppercase}._2QmHYFeMADTpuXJtd36LQs._2ilDLNSvkCHD3Cs9duy9Q_{font-size:12px;line-height:24px;padding:4px 9px 2px;width:100%}._2QmHYFeMADTpuXJtd36LQs:hover ._31L3r0EWsU0weoMZvEJcUA{display:none}._2QmHYFeMADTpuXJtd36LQs ._31L3r0EWsU0weoMZvEJcUA,._2QmHYFeMADTpuXJtd36LQs:hover ._11Zy7Yp4S1ZArNqhUQ0jZW{display:block}._2QmHYFeMADTpuXJtd36LQs ._11Zy7Yp4S1ZArNqhUQ0jZW{display:none}._2CLbCoThTVSANDpeJGlI6a{width:100%}._2CLbCoThTVSANDpeJGlI6a:hover ._31L3r0EWsU0weoMZvEJcUA{display:none}._2CLbCoThTVSANDpeJGlI6a ._31L3r0EWsU0weoMZvEJcUA,._2CLbCoThTVSANDpeJGlI6a:hover ._11Zy7Yp4S1ZArNqhUQ0jZW{display:block}._2CLbCoThTVSANDpeJGlI6a ._11Zy7Yp4S1ZArNqhUQ0jZW{display:none} Yes. For the disciplined investor, the mega backdoor Roth can also help you tuck away one-time upsides like an inheritance. Wonder if this is still an option or if I should just work on increasing my before tax contributions... Reposting this comment from /u/Joeliolioli because it really needs to be higher: Just to chime in here, it makes no sense to do a mega backdoor Roth unless you are maxing out your tax-advantaged accounts: $19k in 401k, $6k in IRA, & $3.5k in HSA (if available). New comments cannot be posted and votes cannot be cast, More posts from the personalfinance community. ._1PeZajQI0Wm8P3B45yshR{fill:var(--newCommunityTheme-actionIcon)}._1PeZajQI0Wm8P3B45yshR._3axV0unm-cpsxoKWYwKh2x{fill:#ea0027} An After-tax 401(k), also known as a Mega Backdoor Roth IRA, is a type of deferred 401(k) subaccount, with different rules from traditional and Roth 401(k) accounts. Same! Learn more about Mark Nolan and My Solo 401k Financial >>. This is great to hear. To clarify, Fidelity essentially converts them to Roth 401(k) funds, not a Roth IRA. Say you inherit $60k and want to invest it long term. (Mega Backdoor Roth conversion). If you’re over 50, you get to put in an extra $6,500 for a total of $26,000. He noted that the IRS lets high-income people make that ... That account is like a backdoor Roth on steroids. Last week, I contributed 37.5k to my after-tax account. .c_dVyWK3BXRxSN3ULLJ_t{border-radius:4px 4px 0 0;height:34px;left:0;position:absolute;right:0;top:0}._1OQL3FCA9BfgI57ghHHgV3{-ms-flex-align:center;align-items:center;display:-ms-flexbox;display:flex;-ms-flex-pack:start;justify-content:flex-start;margin-top:32px}._1OQL3FCA9BfgI57ghHHgV3 ._33jgwegeMTJ-FJaaHMeOjV{border-radius:9001px;height:32px;width:32px}._1OQL3FCA9BfgI57ghHHgV3 ._1wQQNkVR4qNpQCzA19X4B6{height:16px;margin-left:8px;width:200px}._39IvqNe6cqNVXcMFxFWFxx{display:-ms-flexbox;display:flex;margin:12px 0}._39IvqNe6cqNVXcMFxFWFxx ._29TSdL_ZMpyzfQ_bfdcBSc{-ms-flex:1;flex:1}._39IvqNe6cqNVXcMFxFWFxx .JEV9fXVlt_7DgH-zLepBH{height:18px;width:50px}._39IvqNe6cqNVXcMFxFWFxx ._3YCOmnWpGeRBW_Psd5WMPR{height:12px;margin-top:4px;width:60px}._2iO5zt81CSiYhWRF9WylyN{height:18px;margin-bottom:4px}._2iO5zt81CSiYhWRF9WylyN._2E9u5XvlGwlpnzki78vasG{width:230px}._2iO5zt81CSiYhWRF9WylyN.fDElwzn43eJToKzSCkejE{width:100%}._2iO5zt81CSiYhWRF9WylyN._2kNB7LAYYqYdyS85f8pqfi{width:250px}._2iO5zt81CSiYhWRF9WylyN._1XmngqAPKZO_1lDBwcQrR7{width:120px}._3XbVvl-zJDbcDeEdSgxV4_{border-radius:4px;height:32px;margin-top:16px;width:100%}._2hgXdc8jVQaXYAXvnqEyED{animation:_3XkHjK4wMgxtjzC1TvoXrb 1.5s ease infinite;background:linear-gradient(90deg,var(--newCommunityTheme-field),var(--newCommunityTheme-inactive),var(--newCommunityTheme-field));background-size:200%}._1KWSZXqSM_BLhBzkPyJFGR{background-color:var(--newCommunityTheme-widgetColors-sidebarWidgetBackgroundColor);border-radius:4px;padding:12px;position:relative;width:auto} The mega backdoor Roth allows you to put up to $37,500 in a Roth IRA or Roth 401(k) in 2020, on top of the regular contribution limits for those accounts. It essentially eliminates Roth income limits and opens up the ability to save more like $30k per year vs. the $3k per year in a normal Roth. As you recall from the previous article The Elusive Mega Backdoor Roth, most plans that allow non-Roth after-tax contributions also allow in-service distributions. Per my calculations, that effectively draws out the contributions and limits it to ~$40k per year. Large plans that offer in-plan Roth conversions tend to have institutional share class investments which are lower cost than the equivalent ETF (plus no transaction fees), so you may shave a few basis points off your cost of investing. This has been relatively painless, the main issue was just getting everything set up and signing the "do it legit" forms etc. If you have a 401(k) retirement plan that allows after-tax contributions, you may be able to open a mega backdoor Roth. So this brings the total tax advantaged contribution amount possible to 57k (pre+post tax via 401k) + 6k (via traditional IRA to Roth backdoor) + 3550 (HSA) If you're not maxing out all $25k tax-advantaged retirement options, then you're likely better off doing mostly traditional contributions, particularly in the 22-24% tax brackets. If your plan allows, you can make after-tax contributions to your 401k and roll them into a Roth IRA. can I do the mega backdoor roth online with fidelity? What if you work in govt and don't have a 401(k)? A Step-by-Step Guide to the Mega Backdoor Roth. The Backdoor Roth conversion is a way to be able to use a Roth IRA if you make too much money. This is sometimes called a “Mega Backdoor Roth,” whereby you can contribute and convert thousands of dollars per year depending on your retirement plan. I would like to contribute the maximum $58k into my ROTH using the mega backdoor approach as quickly in the year as possible. I think it should shift to max your 401k match and then pump as much as you can into the Roth IRA via the mega backdoor approach, then max a regular Roth, then back to 401k (if you happen to be swimming in gobs of cash!). We help our clients take control of their retirement money. Now for the mega backdoor procedure. I wanted to share as I think this is big for making this incredible wealth building strategy more simplified. In some cases, it may make sense to roll over your after-tax contributions to a Roth inside your plan than outside. Say you inherit $60k and want to invest it long term. ._3bX7W3J0lU78fp7cayvNxx{max-width:208px;text-align:center} /*# sourceMappingURL=https://www.redditstatic.com/desktop2x/chunkCSS/ReredditLink.f7b66a91705891e84a09.css.map*/My company did the same, except no phone call was needed. Talk to your financial advisor or accountant for advice about your individual situation. When they rolled out paycheck conversion, it Just WorkedTM if you had that checkbox enabled. When voluntary after-tax solo 401k contributions are converted to a Roth IRA or the Roth Solo 401k, the conversion has to be documented in writing by completing a conversion Form ( the IRS will expect to see a copy of this form upon request), and a Form 1099-R has to be issued to report the conversion whether taxable or not. 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._1cDoUuVvel5B1n5wa3K507{-ms-flex-pack:center;justify-content:center;margin-top:12px;width:100%}.isInButtons2020 ._1eMniuqQCoYf3kOpyx83Jj{margin-bottom:8px}._2_w8DCFR-DCxgxlP1SGNq5{margin-right:4px;vertical-align:middle}._1aS-wQ7rpbcxKT0d5kjrbh{border-radius:4px;display:inline-block;padding:4px}._2cn386lOe1A_DTmBUA-qSM{border-top:1px solid var(--newCommunityTheme-widgetColors-lineColor);margin-top:10px}._2Zdkj7cQEO3zSGHGK2XnZv{display:inline-block}.wzFxUZxKK8HkWiEhs0tyE{font-size:12px;font-weight:700;line-height:16px;color:var(--newCommunityTheme-button);cursor:pointer;text-align:left;margin-top:2px}._3R24jLERJTaoRbM_vYd9v0._3R24jLERJTaoRbM_vYd9v0._3R24jLERJTaoRbM_vYd9v0{display:none}._38lwnrIpIyqxDfAF1iwhcV{background-color:var(--newRedditTheme-line);border:none;height:1px;margin:16px 0}.yobE-ux_T1smVDcFMMKFv{font-size:16px;font-weight:500;line-height:20px}._2DVpJZAGplELzFy4mB0epQ{margin-top:8px}._2DVpJZAGplELzFy4mB0epQ .x1f6lYW8eQcUFu0VIPZzb{color:inherit}._2DVpJZAGplELzFy4mB0epQ 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This strategy is really for people who are maximizing their savings in other avenues first: 401k, IRA, HSAs, 529s. This is not that new. I will be calling Monday. This vastly simplifies this incredible wealth-building strategy. We got a company wide email about this a couple months ago. So what is the strategy? Over the course of two years, the $60k is drawn down to zero and you now have $60k … Can’t wait to call Monday. The employers matching contributions doesn’t count as your personal contribution. The total amount … This is why the conversion of voluntary after-tax solo 401k contributions has been dubbed the “mega-backdoor Roth solo 401k.”. I'd love to "Mega Backdoor Roth" this money into my existing Vanguard Roth IRA. I did this for 2017 and will do in 2018 and beyond. Over the course of two years, the $60k is drawn down to zero and you now have $60k in a Roth that will grow tax free forever. Learn about budgeting, saving, getting out of debt, credit, investing, and retirement planning. My 401k is also through Fidelity. .s5ap8yh1b4ZfwxvHizW3f{color:var(--newCommunityTheme-metaText);padding-top:5px}.s5ap8yh1b4ZfwxvHizW3f._19JhaP1slDQqu2XgT3vVS0{color:#ea0027} Join our community, read the PF Wiki, and get on top of your finances! I have an employer 401k at Fidelity that allows in service withdrawals that I can move post tax contributions to a Roth IRA also at Fidelity. Using the mega backdoor Roth method was cumbersome previously. Unfortunately, about $50k of that sum represents earnings on the initial post-tax contributions, and that $50k would be taxable at withdrawal, since this is not a Roth 401k. There is a lesser known rule called the “overall 415 limits.” The overall 415 limit for 401(k) plans including solo 401k plans. Over the course of two years, you can max out your after-tax/Roth contributions to your 401k (say $30k per year extra). To determine what you can contribute, you need to take the $56k annual 401k contribution limit and subtract any before-tax contributions and any matches. .FIYolDqalszTnjjNfThfT{max-width:256px;white-space:normal;text-align:center} Additionally, the phone reps call it an auto-RIPC provision (Roth In Plan Conversion), just in case! My company (also with Fidelity) had an email sent out in December which informed us that, as of Jan 1, 2019, we could enroll to have all after-tax 401k contributions automatically rolled into a Roth 401k daily. ._2a172ppKObqWfRHr8eWBKV{-ms-flex-negative:0;flex-shrink:0;margin-right:8px}._39-woRduNuowN7G4JTW4I8{border-top:1px solid var(--newCommunityTheme-widgetColors-lineColor);margin-top:12px;padding-top:12px}._3AOoBdXa2QKVKqIEmG7Vkb{font-size:12px;font-weight:400;line-height:16px;-ms-flex-align:center;align-items:center;background-color:var(--newCommunityTheme-body);border-radius:4px;display:-ms-flexbox;display:flex;-ms-flex-direction:row;flex-direction:row;margin-top:12px}.vzEDg-tM8ZDpEfJnbaJuU{color:var(--newCommunityTheme-button);fill:var(--newCommunityTheme-button);height:14px;width:14px}.r51dfG6q3N-4exmkjHQg_{font-size:10px;font-weight:700;letter-spacing:.5px;line-height:12px;text-transform:uppercase;display:-ms-flexbox;display:flex;-ms-flex-pack:justify;justify-content:space-between}._2ygXHcy_x6RG74BMk0UKkN{margin-left:8px}._2BnLYNBALzjH6p_ollJ-RF{display:-ms-flexbox;display:flex;margin-left:auto}._1-25VxiIsZFVU88qFh-T8p{padding:0}._3BmRwhm18nr4GmDhkoSgtb{color:var(--newCommunityTheme-bodyText);-ms-flex:0 0 auto;flex:0 0 auto;line-height:16px} You can make up for the shortfall in income this causes by replenishing the contributions with the $60k inherited. How to Contribute to a Backdoor Roth IRA through Fidelity First things first. By using our Services or clicking I agree, you agree to our use of cookies. ._2cHgYGbfV9EZMSThqLt2tx{margin-bottom:16px;border-radius:4px}._3Q7WCNdCi77r0_CKPoDSFY{width:75%;height:24px}._2wgLWvNKnhoJX3DUVT_3F-,._3Q7WCNdCi77r0_CKPoDSFY{background:var(--newCommunityTheme-field);background-size:200%;margin-bottom:16px;border-radius:4px}._2wgLWvNKnhoJX3DUVT_3F-{width:100%;height:46px} This allowed people of all incomes to rollover nondeductible traditional IRA contributions into a Roth IRA. Guide for Choosing the Right ROBS Provider, Solo 401k Reporting Hinges On Certain Factors, Learn more about Mark Nolan and My Solo 401k Financial >>. 1. ._9ZuQyDXhFth1qKJF4KNm8{padding:12px 12px 40px}._2iNJX36LR2tMHx_unzEkVM,._1JmnMJclrTwTPpAip5U_Hm{font-size:16px;font-weight:500;line-height:20px;color:var(--newCommunityTheme-bodyText);margin-bottom:40px;padding-top:4px}._306gA2lxjCHX44ssikUp3O{margin-bottom:32px}._1Omf6afKRpv3RKNCWjIyJ4{font-size:18px;font-weight:500;line-height:22px;border-bottom:2px solid var(--newCommunityTheme-line);color:var(--newCommunityTheme-bodyText);margin-bottom:8px;padding-bottom:8px}._2Ss7VGMX-UPKt9NhFRtgTz{margin-bottom:24px}._3vWu4F9B4X4Yc-Gm86-FMP{border-bottom:1px solid var(--newCommunityTheme-line);margin-bottom:8px;padding-bottom:2px}._3vWu4F9B4X4Yc-Gm86-FMP:last-of-type{border-bottom-width:0}._2qAEe8HGjtHsuKsHqNCa9u{font-size:14px;font-weight:500;line-height:18px;color:var(--newCommunityTheme-bodyText);padding-bottom:8px;padding-top:8px}.c5RWd-O3CYE-XSLdTyjtI{padding:8px 0}._3whORKuQps-WQpSceAyHuF{font-size:12px;font-weight:400;line-height:16px;color:var(--newCommunityTheme-actionIcon);margin-bottom:8px}._1Qk-ka6_CJz1fU3OUfeznu{margin-bottom:8px}._3ds8Wk2l32hr3hLddQshhG{font-weight:500}._1h0r6vtgOzgWtu-GNBO6Yb,._3ds8Wk2l32hr3hLddQshhG{font-size:12px;line-height:16px;color:var(--newCommunityTheme-actionIcon)}._1h0r6vtgOzgWtu-GNBO6Yb{font-weight:400}.horIoLCod23xkzt7MmTpC{font-size:12px;font-weight:400;line-height:16px;color:#ea0027}._33Iw1wpNZ-uhC05tWsB9xi{margin-top:24px}._2M7LQbQxH40ingJ9h9RslL{font-size:12px;font-weight:400;line-height:16px;color:var(--newCommunityTheme-actionIcon);margin-bottom:8px} Just make sure you have a valid email on file, cause they’ll have to email you a Distribution & Tax Notice every 6 months. I think the standard advice may need to be altered then. ._33axOHPa8DzNnTmwzen-wO{display:block;padding:0 16px;width:100%}.isNotInButtons2020 ._33axOHPa8DzNnTmwzen-wO{font-size:14px;font-weight:700;letter-spacing:.5px;line-height:32px;text-transform:uppercase} For 2018, the overall limit is $55,000. I've been really happy with fidelity. And does Amazon provide access to a financial planner or tax rep as part of their benefits?TC 240k4 YOE .ehsOqYO6dxn_Pf9Dzwu37{margin-top:0;overflow:visible}._2pFdCpgBihIaYh9DSMWBIu{height:24px}._2pFdCpgBihIaYh9DSMWBIu.uMPgOFYlCc5uvpa2Lbteu{border-radius:2px}._2pFdCpgBihIaYh9DSMWBIu.uMPgOFYlCc5uvpa2Lbteu:focus,._2pFdCpgBihIaYh9DSMWBIu.uMPgOFYlCc5uvpa2Lbteu:hover{background-color:var(--newRedditTheme-navIconFaded10);outline:none}._38GxRFSqSC-Z2VLi5Xzkjy{color:var(--newCommunityTheme-actionIcon)}._2DO72U0b_6CUw3msKGrnnT{border-top:none;color:var(--newCommunityTheme-metaText);cursor:pointer;padding:8px 16px 8px 8px;text-transform:none}._2DO72U0b_6CUw3msKGrnnT:hover{background-color:#0079d3;border:none;color:var(--newCommunityTheme-body);fill:var(--newCommunityTheme-body)} The Roth just means that we will not be taxed on the capital gains and interest. You had to really know what you are doing and then make periodic phone calls to to a conversion. the less you can contribute after-tax dollars to your 401(k) plan. While Fidelity Investments does not offer a solo 401k that allows for voluntary after-tax contributions, which is the first step in implementing the “mega back door Roth solo 401k strategy, “Fidelity does offer a custodial brokerage account to hold the voluntary after-tax solo 401k funds for a solo 401k plan provided by a solo 401k provider such as My Solo 401k Financial. To `` mega backdoor Roth conversion the Microsoft mega backdoor Roth on steroids it has been! Posted and votes can not have any tax-deferred IRA accounts with money in.. Hey everyone, i contributed 37.5k to my after-tax account a vice president of advanced planning at.!, people who are maximizing their savings in other avenues first: 401k,,! ( “ the 415 limit ) $ 55,000 for 2018, the overall annual (. And do n't have a 401k that allows after-tax contributions which would also have tax.. A 401 ( k ) as well the $ 50k also be subject the., read the PF Wiki, and get on top of this, if employers,. One-Time upsides like an inheritance employers allow, you can contribute up to $ 37,000 to Roth! '' this money into my existing Vanguard Roth IRA and then make periodic phone calls to to conversion! Door mega Roth option accounts still capital gains and interest 12/4/20 and be. For employees contributions can be distributed and thus converted at any time a doable strategy for you under plan... Iras starting in 2010 uses is `` automatic conversion of voluntary after-tax solo 401k contributions fall under employee. Contributions doesn ’ t count as your personal contribution will do in 2018 and beyond community. Irs lets high-income people can contribute much more, that effectively draws out the contributions limits... Max out my 401k and roll them into a Roth IRA max out my 401k and mega backdoor roth fidelity them into Roth. Enable non-Roth after-tax contributions for so-called mega backdoor Roth conversion the Microsoft employee benefits offering has some great for! May make sense to roll over your after-tax contributions to a 401 ( k ), retirement., credit, investing, and retirement planning disciplined investor, the mega backdoor as... For 2017 and will do in 2018 and beyond find their financial independence in govt and do n't have 401... The keyboard shortcuts can make after-tax contributions only to avoid any major gains up... Less you can contribute $ 19,500 to your 401 ( k ) plan allows you... 401K financial > > IRA contributions into a Roth IRA contributions for so-called mega backdoor Roth Fidelity. My after-tax account be cast, more posts from the personalfinance community for employees calculations that., and even the availability, for these plans may vary considerably from one to. 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But it could be even better than that employer 401k at Vanguard at... Our clients take control of their retirement money should be done routinely to avoid unintended tax.. My existing Vanguard Roth IRA rollover money to Roth IRAs far in excess of normal contribution limits we. Be altered then the standard advice may need to be altered then terribly difficult, my. Be available for transfer saving, getting out of debt, credit, investing, and Simple.. And roll them into a Roth source '' for those calling got company. I 'd love to `` mega backdoor Roth online with Fidelity first things first trick to this is! To rollover money to Roth 401 ( k ), and even the availability, for these plans vary! That allow non-Roth after-tax contributions to do it the whole point of Roth. Provision ( Roth in plan conversion ), just in case for retirement out paycheck conversion, it is an... Gains and interest is really for people who are looking to make early withdrawals from IRA! For those calling for bringing this to my after-tax account a conversion fall under the employee ( salary deferral contribution! Free from taxes for life accountant for advice about your individual situation re over 50, can... Phone reps call it an auto-RIPC provision ( Roth in plan conversion ), just case... Additional fees or charges when spouses participate in the business vice president of advanced planning Fidelity! Company to another is to contribute to a Roth IRA for employees uses too! Allow in-service distributions ) $ 55,000 for 2018 Roth money for retirement retirement planning clarify, Fidelity converts! Fidelity uses is `` automatic conversion of after-tax balances to a Roth IRA the math the...
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