That was what had me confused but have had 3 people now tell me Roth everything you can.
they all stated the probability of taxes

the conventional logic I had always heard was you will not be making as much as much later and you will pay less in taxes now because it will be a lower net income being taxed

and no worries on my making over the limit any time soon.

X2 ebsurveyor !


My late, ex father-in-law was a wise, self-made, multi millionaire.

Here is his philosophy.

1. Tell your wife nothing.
2 Tell your lawyer only what he needs to know.
3.Tell your CPA everything.

That would be my suggestion in the case of this pension buyout.
Spend a couple hundred bucks and hire a CPA. Give him all the details about the buyout and your financial situation. Let him do the work and advise you of the various alternatives.

Just for clarification for some that might not know:

#1. Roth contributions have limits, $6,000 for 2022 & $6,500 for 2023
#2. If your adjusted gross income is above a certain amount, you may not contribute to a Roth. If you file taxes as a single person, your Modified Adjusted Gross Income (MAGI) must be under $144,000 for tax year 2022 and $153,000 for tax year 2023 to contribute to a Roth IRA, and if you're married and filing jointly, your MAGI must be under $214,000 for tax year 2022 and $228,000 for tax year 2023.

[e=GREENCOUNTYPETE]I don't know anything about pension buy out , other than it is to have a fixed cost that they can pay and be done with.

the only advice I have it all the finantial people I know now are saying Roth IRA put everything you can in the Roth as they expect we will see EU type taxes in the fairly near future.

used to be 401K all pre tax contributions were pushed because you wouldn't make as much after retirement , now it seems that will matter less they will tax you to death anyway.

Just for clarification for some that might not know:

#1. Roth contributions have limits, $6,000 for 2022 & $6,500 for 2023
#2. If your adjusted gross income is above a certain amount, you may not contribute to a Roth. If you file taxes as a single person, your Modified Adjusted Gross Income (MAGI) must be under $144,000 for tax year 2022 and $153,000 for tax year 2023 to contribute to a Roth IRA, and if you're married and filing jointly, your MAGI must be under $214,000 for tax year 2022 and $228,000 for tax year 2023.

"I might be wrong but that limit does not apply to a roll over. Can this be done or is considered as a roll over? "


That would be the king of all sucker bets. Example, roll over $100,000 to a roth. Pay taxes on the full $100,000 at the time of the roll over. You will never make those lost dollars back. Again, does anyone think that the government would ever do anything with taxes that does not benefit them more than it benefits you!

uote=ebsurveyor]



"I might be wrong but that limit does not apply to a roll over. Can this be done or is considered as a roll over? "


That would be the king of all sucker bets. Example, roll over $100,000 to a roth. Pay taxes on the full $100,000 at the time of the roll over. You will never make those lost dollars back. Again, does anyone think that the government would ever do anything with taxes that does not benefit them more than it benefits you!

Roths are a great vehicle for transferring wealth to your children (heirs) after death...as compared to traditiinal retirement accounts.
They are not subject to the new 10-year liquidation inheritance law that was passed in the last few years. If you are planning to be flat broke upon death, or dont care about what happens after you are gone, I guess it doesnt matter.

That would be the king of all sucker bets. Example, roll over $100,000 to a roth. Pay taxes on the full $100,000 at the time of the roll over. You will never make those lost dollars back. Again, does anyone think that the government would ever do anything with taxes that does not benefit them more than it benefits you!

Like I said Ebsurveyor, if you dont care what happens after death, it doesnt matter...and there is nothing wrong with that if thats your thing. I do care, and Im gonna plan for my heirs to the best of my ability. Nope, cant guarantee they wont change the Roth law. Can't guarantee they wont change any law for that matter, but im sure gonna plan the best I can for the laws that we currently have.

I simply wanted to point out that there are definitely some advantages to a Roth. If there werent, you wouldn't see so many wealthy, including mega wealthy people taking advantage of it. Most of them didnt get rich by being stupid and they can afford the best CPAs i the country. My post wasn't to call you out, but add more information to the topic.

IMO, if one were to invest the tax payments necessary with a ROTH. You will be many dollars ahead when the money is needed. This applies even it takes many generations to need the money.

I found this interesting:

Is it smart to move money from an IRA to a Roth IRA?
If you're approaching retirement or need your IRA money to live on, it's unwise to convert to a Roth. Because you are paying taxes on your funds, converting to a Roth costs money. It takes a certain number of years before the money you pay upfront is justified by the tax savings.

That does not even consider what would happen if one chose to invest the "tax money".

I can certainly see your point and it has me wondering why financial advisors are now saying go roth over traditional

Does anyone have any experience with a pension plan that a company wants to get out of and is offering a buyout. Asking for a friend(son), because I am long past that time in my life.
Gary J

Tell me more, please. Even at age 76 I am still not able to ROTH. This has stopped me for the past 20years.

"If your adjusted gross income is above a certain amount, you may not contribute to a Roth. If you file taxes as a single person, your Modified Adjusted Gross Income (MAGI) must be under $144,000 for tax year 2022 and $153,000 for tax year 2023 to contribute to a Roth IRA, and if you're married and filing jointly, your MAGI must be under $214,000 for tax year 2022 and $228,000 for tax year 2023."

[Like I said Ebsurveyor, if you dont care what happens after death, it doesnt matter...and there is nothing wrong with that if thats your thing. I do care, and Im gonna plan for my heirs to the best of my ability. Nope, cant guarantee they wont change the Roth law. Can't guarantee they wont change any law for that matter, but im sure gonna plan the best I can for the laws that we currently have.

I simply wanted to point out that there are definitely some advantages to a Roth. If there werent, you wouldn't see so many wealthy, including mega wealthy people taking advantage of it. Most of them didnt get rich by being stupid and they can afford the best CPAs i the country. My post wasn't to call you out, but add more information to the topic.

Tell me more, please. Even at age 76 I am still not able to ROTH. This has stopped me for the past 20years.

"If your adjusted gross income is above a certain amount, you may not contribute to a Roth. If you file taxes as a single person, your Modified Adjusted Gross Income (MAGI) must be under $144,000 for tax year 2022 and $153,000 for tax year 2023 to contribute to a Roth IRA, and if you're married and filing jointly, your MAGI must be under $214,000 for tax year 2022 and $228,000 for tax year 2023."


For those over the MAGI, they can use a backdoor Roth. Democrats are hoping to close that loophole, but haven't succeeded yet. Thats how the wealthy still get money into a ROTH.
My financial advisors dont make a single cent from recommending Roth401k over a regular 401k...in fact, he makes no money from my 401k money at all. As mentioned in my first post, a Roth might not be for everybody based on individual needs, but they sure as heck have benefits that can help many.