The Tax Efficiency of Taxable Assets, Traditional 401(k)/IRAs, and Roth 401(k)/IRAs: The Traditional Is a Joint Venture Between the Employee/ Retiree and the Government, with the Employee/Retiree’s Interest a “Roth” Within

Authors

William KS Wang, University of California Law San FranciscoFollow

Recommended Citation

William KS Wang, The Tax Efficiency of Taxable Assets, Traditional 401(k)/IRAs, and Roth 401(k)/IRAs: The Traditional Is a Joint Venture Between the Employee/ Retiree and the Government, with the Employee/Retiree’s Interest a “Roth” Within, 42 ABA Tax Times (2003).
Available at: https://repository.uclawsf.edu/faculty_scholarship/2018

Publication Date

Spring 6-2003

Abstract

This article discusses three investments ranked in order of increasing tax efficiency: taxable assets, traditional 401(k)/IRAs (traditional accounts), and Roth 401(k)/IRAs (standalone Roth accounts). It is worth noting at the outset that retirement accounts are extraordinarily efficient for tax purposes. 3 With any increase in personal income or capital gains tax rates, taxable assets become even less tax-efficient relative to both the “Roth” within the traditional account and the standalone Roth account.

Document Type

Article

Publication Title

ABA Tax Times