As of March 2022, the Backdoor Roth IRA is still alive. Therefore, any taxpayer making more than $214,000 in income and is married and filing jointly can make an after-tax Traditional IRA contribution and then potentially do a tax-free Roth IRA conversion.
On April 5, you could convert your traditional IRA to a Roth IRA. However, the conversion can't be reported on your 2021 taxes. Because IRA conversions are only reported during the calendar year, you should report it in 2022.
There is no particular deadline to complete the Roth conversion step. By prohibiting Roth conversions of after-tax money in traditional IRAs beginning January 1, 2022, Congress effectively makes December 31, 2021 the deadline to execute the Roth conversion step of a 2021 Backdoor Roth IRA.
You have until April 15, 2022, to add funds to your traditional or Roth IRA and have it count toward your 2021 contribution limit. This gives you an extra chance to save even more for your retirement in 2022. In 2022, the contribution limit for both traditional and Roth IRAs is $6,000.
Contribution rules
Meaning, you can fund your 2022 IRA at any time between Jan. 1, 2022, and the tax filing deadline in 2023. You may contribute to a traditional IRA or Roth IRA whether or not you participate in a retirement plan through your job, such as a 401(k).
Is there a deadline to convert? Yes, the deadline is December 31 of the current year. A conversion of after-tax amounts is not included in gross income.
2021 Traditional & Roth IRA Contribution Deadline is 4/15/2022.
The maximum amount you can contribute to a traditional IRA for 2022 is $6,000 if you're younger than age 50. Workers age 50 and older can add an extra $1,000 per year as a "catch-up" contribution, bringing the maximum IRA contribution to $7,000.
Individual IRA and Roth IRA accounts offer another way to save for retirement. Your total contributions to traditional or Roth IRAs are limited to $6,000 in 2022—the same as in 2021. Taxpayers who are 50 and older can make an additional $1,000 catch-up contribution.
You will only enter your contribution on your 2021 tax return. The conversion will be entered on your 2022 tax return when you get the 2022 Form 1099-R. You will have a basis on your 2021 Form 8606 line 14 to carry forward to 2022.
You can make backdoor Roth IRA contributions each year. Keep an eye on the annual contribution limits. If your annual contribution limit is $6,000, that's the most you can put into all of your IRA accounts. You might put the entire amount into your backdoor Roth.
As noted above, the most you can contribute to your Roth and traditional IRAs in the year leading up to April 15, 2022 (for the 2021 tax year) and then again for the year 2022 leading up to April 15, 2023 (for the 2022 tax year) is: $6,000 if you're younger than age 50. $7,000 if you're aged 50 or older1.
Key Takeaways. There is no age restriction for contributions to Roth individual retirement accounts (IRAs). You can now make contributions to traditional IRAs beyond the previous age limit of 70½ years, thanks to the Setting Every Community Up for Retirement Enhancement (SECURE) Act enacted in 2019.
You can funnel $20,500 into your 401(k) plan for 2022, up from $19,500 from 2021. Boosting your contribution rate now offers more time for growth, and may make it easier to meet yearly goals. But you need to know how your company's 401(k) match works before front-loading deposits, experts say.
You can still set up and contribute to a SEP for 2021.
If you are looking to minimize for 2022, check out a Solo 401(k) or Cash Balance Pension plan, both of which will offer larger savings in most business-owner scenarios.
The Bottom Line
As long as you meet eligibility requirements, such as having earned income, you can contribute to both a Roth and a traditional IRA. How much you contribute to each is up to you, as long as you don't exceed the combined annual contribution limit of $6,000, or $7,000 if you're age 50 or older.
You generally must make the rollover contribution by the 60th day after the day you receive the distribution from your traditional IRA or your employer's plan.
IRC Section 402(g) limits the amount of retirement plan elective deferrals you may exclude from taxable income in your taxable year, which is generally the calendar year. Your 402(g) limit for 2022 is $20,500 ($19,500 in 2020 and 2021).
The maximum amount you can contribute to a Roth 401(k) for 2022 is $20,500 if you're younger than age 50. This is an extra $1,000 over 2021. If you're age 50 and older, you can add an extra $6,500 per year in "catch-up" contributions, bringing the total amount to $27,000.
The IRS allows only one rollover per year, but this rule doesn't apply to backdoor IRA conversions, so you can convert monies several times a year. You can withdraw your contributions from a Roth IRA at any time without penalty or taxes.
There's no limit on how much you can convert. Here are the three ways to get your money from a traditional account to a Roth: Indirect rollover. You'll receive a distribution check from your traditional IRA and then contribute it to your Roth IRA within 60 days.
Backdoor Roth IRA Conversion Deadline
It can take place the next day or even the same day as the contribution. I don't recommend it, but you can wait months, years, or even decades between the contribution and the conversion step. There is no deadline on Roth conversions.
The 401(k) contribution limit for 2022 is $20,500, and the catch-up contribution allows workers to add an additional $6,500 – for a grand total of $27,000 each year.
Thanks to rampant inflation, it is beginning to look more and more likely that IRS retirement plan contribution limits will see large, record-setting jumps for 2023, according to the most recent forecast from Milliman.