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Updated almost 12 years ago,

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1
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Jeanne Choi
  • Washington, DC
0
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1
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Need help with backdoor options

Jeanne Choi
  • Washington, DC
Posted

Background: I am a newbie that just found out about the concept of backdoor Roth from a friend. I'm trying to get as much money as possible into a self-directed Roth 401k as soon as possible for an investment opportunity that closes very soon. My husband and I have no traditional IRAs. I run my own LLC and currently have no retirement plan set up through it and my husband can be considered an employee of the company as he has provided services to it (I am the only other employee). My husband has a plain-vanilla 401k through his employer that he maxed out in 2012 (the employer does not match at all).

What are our options to maximize the amount we can each get into a self-directed IRA in the next two weeks and what amounts would each of us contribute? Should I set up a after tax 401k through my work and have us both contribute (or does my husbands one 401k forgo him from being able to participate in another in 2013, even if he provides no contributions to his existing 401k). Or are we simply limited to 10K each (5K for each of 2012 and 2013) to add to a traditional after-tax IRA and then roll them both over to self directed Roth IRAs?