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Honestly they should close the backdoor Roth and update the Roth income rules to stop requiring the backdoor Roth. It's annoying to use it as is. Getting rid of

Honestly they should close the backdoor Roth and update the Roth income rules to stop requiring the backdoor Roth. It's annoying to use it as is. Getting rid of the mega backdoor seems like a no brainer since it's a clear loophole. Or if you want to keep something similar, change the Roth contribution limits for everyone.

majora2007 5y ago
This is what I'm most bumed on with the mega backdoor and backdoor, but closing them and just opening them for everyone would be ideal. Because you can still contribute to Roth regardless on income level if you know about backdoor, so it makes sense just to legalize across the board.
lotsofpulp 5y ago
They should close 401k and all other tax advantaged retirement accounts, and just have regular IRA and Roth IRA for everyone, and remove employers from the equation.
- the_optimist 5y ago
  This is the best idea. Having employers involved in healthcare and retirement is really crummy. These vestiges of history have been corrupted into massive handouts to the insurance and financial industries, and there is no reason they need to exist.
  - BeFlatXIII 5y ago
    My #1 problem with the Affordable Care Act was that it tried to mandate universal health insurance coverage while leaving employer-sponsored insurance in place. If they were going to mandate that we urinate our money away to insurance companies (rather than assess an honest tax for single-payer healthcare), they should have prohibited employer-sponsored healthcare benefits to force everyone into the same insurance pool.
    - lotsofpulp 5y ago
      “They” tried, but insufficient politicians supported it. Everything about ACA was as that it was a compromise to even get that much. The only other option was to not have had healthcare reform at all. I think ACA will go down in history as a pretty impressive effort that at least did something to increase the number of people with access to healthcare.
- ac29 5y ago
  They'd need to raise the limits then - the contribution limits on traditional/Roth IRAs are significantly lower than employer plans like 401ks.
  - lotsofpulp 5y ago
    I do not mind what the limits are as long as it is fair for everyone and not discriminating against those employed by an employer not offering 401k.
- nullc 5y ago
  Also increase the contribution limits to the hard maximum including employer contributions (e.g. $64.5k/yr) or eliminate them entirely then just cap the maximum post-tax value of your total tax advantaged accounts and require payouts above the caps. The maximum value cap should be indexed to your age (and inflation), such that the maximum allowed is enough that if left alone can support a very well funded retirement anywhere in the country with very high probability.

majora2007 5y ago

This is what I'm most bumed on with the mega backdoor and backdoor, but closing them and just opening them for everyone would be ideal. Because you can still contribute to Roth regardless on income level if you know about backdoor, so it makes sense just to legalize across the board.

lotsofpulp 5y ago

They should close 401k and all other tax advantaged retirement accounts, and just have regular IRA and Roth IRA for everyone, and remove employers from the equation.

the_optimist 5y ago
This is the best idea. Having employers involved in healthcare and retirement is really crummy. These vestiges of history have been corrupted into massive handouts to the insurance and financial industries, and there is no reason they need to exist.
- BeFlatXIII 5y ago
  My #1 problem with the Affordable Care Act was that it tried to mandate universal health insurance coverage while leaving employer-sponsored insurance in place. If they were going to mandate that we urinate our money away to insurance companies (rather than assess an honest tax for single-payer healthcare), they should have prohibited employer-sponsored healthcare benefits to force everyone into the same insurance pool.
  - lotsofpulp 5y ago
    “They” tried, but insufficient politicians supported it. Everything about ACA was as that it was a compromise to even get that much. The only other option was to not have had healthcare reform at all. I think ACA will go down in history as a pretty impressive effort that at least did something to increase the number of people with access to healthcare.
ac29 5y ago
They'd need to raise the limits then - the contribution limits on traditional/Roth IRAs are significantly lower than employer plans like 401ks.
- lotsofpulp 5y ago
  I do not mind what the limits are as long as it is fair for everyone and not discriminating against those employed by an employer not offering 401k.
nullc 5y ago
Also increase the contribution limits to the hard maximum including employer contributions (e.g. $64.5k/yr) or eliminate them entirely then just cap the maximum post-tax value of your total tax advantaged accounts and require payouts above the caps. The maximum value cap should be indexed to your age (and inflation), such that the maximum allowed is enough that if left alone can support a very well funded retirement anywhere in the country with very high probability.