Mega back door roth IRA vs 403b/457b

Home Retirement Accounts Mega back door roth IRA vs 403b/457b

  • Avatar tartoosi 
    Status: Physician
    Posts: 1
    Joined: 07/28/2019


    New attending making 260k. I’m maxing out my 401k with employer match as well as my Roth IRA. My employer also offers a 403b and a 457b that I may contribute a maximum of 19k each. Would it be better to max out both the 403b and 457b for a combined 38k total or would it be better to do a mega back door roth IRA contribution (which would be ~36k to reach the allowed 56k limit)?


    #234431 Reply
    Avatar Peds 
    Status: Physician
    Posts: 4410
    Joined: 01/08/2016

    Does your plan allow megaback door?

    #234443 Reply
    Avatar spiritrider 
    Status: Small Business Owner
    Posts: 1903
    Joined: 02/01/2016

    There is only one employee elective contribution limit (2019 = $19K) across all 401k, 403b, SARSEP and SIMPLE IRA plans. If you are maxing the employee elective contribution limit with a 401k you can not make any 403b employee elective contributions.

    The 457b has a separate but equal contribution limit (2019 = $19K) that also is not included in the employee + employer annual addition limit (2019 = $56K).

    You can only do a Mega Backdoor Roth. If an employer plan allows employee after-tax contributions and (in-service rollovers and/or In-plan Roth Rollovers IRR). Your maximum employee after-tax contribution would be = $56K – any employee elective contributions – any employer contributions to that plan

    #234446 Reply
    Avatar jacoavlu 
    Status: Physician, Small Business Owner
    Posts: 2374
    Joined: 03/01/2018

    and what is your marginal tax rate?

    The Finance Buff's solo 401k contribution spreadsheet:

    #234447 Reply
    Liked by Peds

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