Roth IRAs have long been a great way for investors to put away money for retirement that can grow tax-free. Unlike regular IRAs - in which pretax money is put into the account, and then considered ordinary income when it's withdrawn - Roths allow savers to put away taxable income, which can then be withdrawn without being taxed.
There's been one serious drawback to these plans: Roth IRAs haven't been available to high-net-worth individuals. Taxpaying couples with adjusted gross income above $191,000 (or singles with income above $129,000) have been barred from contributing directly to an IRA.
But a recent IRS ruling has changed all that. The IRS recently announced it would allow taxpayers of any income level to shift money from a 401(k) to a Roth IRA. The ruling officially goes into effect next year, although the IRS says taxpayers can start shifting that money right now.
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