[USER]

Assuming I am going to retire at the end of March next year, would it make sense tax wise to put 90%+ of my paychecks that year into my 401k to try and max it out before I quit?

I would be able to earn the money from a high salary job almost all as pretax income and still be setup that year to do roth conversions later in the year since my taxable income was so low.

I thought I read an article about doing something like this a long time ago but I can’t find it.

[Bill]

Most have a cap since there are still tax withholdings, insurance etc. I think mine is 75%.

It doesn’t make a ton of sense though.

Cut out the middle man and just contribute to the Roth directly vs making a traditional contribution and converting it the same year.

Then any growth during the first 3 months also goes to Roth.

[Christopher]

The pre tax advantage doesn’t exist if you have a low tax liability (due to retiring etc).

I’d just do a Roth contribution and be done with it – the tax liability will be the same either way.

[Joel]

Contributing as Roth is optimal, but you can always roll it over into a Roth IRA after you retire.

Both have you paying the taxes and ending with Roth, but making direct Roth contributions and having taxes withheld and maxing out all by the end of March may require a pretty fat salary.

The year I retired, I decide to contribute all Roth, maxing out my HSA, my ESPP, my Roth 401(k) and my Mega backdoor Roth 401(k) contributions before I quit on July 16th.

To make it happen I had to change my W-4 to basically stop withholding.

Then I made estimated quarterly tax payments instead.

[Author]

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