Decoding Backdoor and Mega Backdoor Roth IRA Conversions

Backdoor and mega backdoor Roth IRA conversions have become increasingly popular among high-income clients who are otherwise ineligible for direct Roth IRA contributions. However, these strategies come with complex tax, aggregation and plan-level compliance rules that can easily trigger unintended taxable events. This session breaks down the mechanics, eligibility requirements, and potential pitfalls of both the backdoor and mega backdoor Roth strategies to help bank and trust professionals guide clients and ensure compliance.

Discussion Highlights

• Explain how the backdoor and mega backdoor Roth strategies work and when they can be used.
• Identify key eligibility, contribution and pro-rata rule considerations for clients.
• Recognize plan-level requirements and compliance traps that can cause taxable conversions.
• Apply correction and reporting guidance when conversion or contribution errors occur.

Speaker

• Denise Appleby, CEO, Appleby Retirement Consulting Inc.