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Help me fix this backdoor roth fail

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  • Help me fix this backdoor roth fail

    Hello, please help me fix this series of events without losing too much money and breaking any laws:

    2015: Spouse contributed $5400 after tax money to a Roth IRA, but we were over the income limit (he had been automatically investing in a Roth IRA as a resident, and forgot to change it once he became an attending).

    2016: He realized his error and recharacterized $5700 as a traditional IRA. Planned to do backdoor but was afraid it was illegal. Yup.

    Now it's 2019, and there is about $7600 in the Vanguard account. He also has a Roth IRA with Vanguard. No other IRAs, but has a 401K and TSP.

    Here's what I've gathered so far are my options:

    1) Do backdoor roth with $6000 now, then do a roth conversion with the remaining $1600 (and owe taxes)

    2) Do backdoor roth with $6000 now, then roll over the remaining $1600 to his 401K at a different investment firm

    Any help would be greatly appreciated!!!


  • #2
    Roll $2,200 into the TSP and convert the $5400 of basis from the prior year’s contribution to a Roth. Then, contribute $6k to the TIRA after tax and do a backdoor Roth with this. You should be able to get $11,400 into the Roth and be free of any tax burden, provided you can roll the growth into the TSP.


    • #3
      The way you described it, you could convert the entire $7,600. There will be taxes due on the $2,300 of growth.

      Youcould also make your 2019 Backdoor Rothcontributionand convert the entire $13,600.