Chance of IRA conversions (& "Backdoor Roth Ladder") ending?

[C40]

See here: https://www.marketwatch.com/story/congr ... eid=yhoof2

The bill “prohibits all employee after-tax contributions in qualified plans and prohibits after-tax IRA contributions from being converted to Roth regardless of income level, effective for distributions, transfers, and contributions made after Dec. 31, 2021,”

I think ending these conversions has been floated many times by the government. Anyone have input on the likelihood of it happening this time? It would have a big impact for many of us ERE'ers, myself included.

[Mister Imperceptible]

Is this another move by the Boomers to let them get fatter and fatter while making extra trips through the buffet line right up until they die? Seems they are clogging up the higher levels of org charts and keeping the millenials suck at the lower levels, allowed to eat only from the salad bar. Then, when the old guys do kick the can, the Gen X and millennial heirs pay the taxes that grandpa never did?

You know the Boomer elites have been pulling up the ladders for some time now.

Maybe start planning for these things to be a certainty.

[unemployable]

They went the opposite way last year, allowing withdrawals up to $100k without penalty.

Sounds like it ends new Roth 401ks completely but continues to allow new Roth IRA contributions outside of employer plans. I could see this happening. For now it flies a bit lower on the radar than the other stuff they're throwing around.

I don't see double taxation of Roths as politically viable. Lots of people on both sides are invested in them.

From a retirement planning perspective I say it's ideal to have money in all three types of accounts -- taxable, traditional and Roth. They each have their separate advantages.

[Scott 2]

One poster on MMM claims: You'd still be able to convert pre-tax balances as long as your income is less than $400k (single)/$450k (married).

https://forum.mrmoneymustache.com/taxes ... msg2902375


I found a link to the bill in that thread, but don't have the patience to read it:

https://waysandmeans.house.gov/sites/de ... 32_xml.pdf


Edit - this CNBC article says conversions would stop at the current Roth contribution income limits:

https://www.cnbc.com/2021/09/13/house-d ... althy.html


I don't think we can plan against this until legislation makes it through the house, at a minimum.

[Western Red Cedar]

I read the MMM thread a few days ago and think it is worth reading through. I honestly trust some of those posters more than the marketwatch or cnbc writers.

My main takeaway is that it isn't worth worrying about until it actually passes. There are still a lot of negotiations taking place, the final bill will likely differ significantly from the draft. Who knows what the sausage will ultimately look like.

[WFJ]

Only if one makes more than $400k per year. If ERE, work for 5-6 years, then backdoor ROTH for the next 30 years, problem solved.