Can you still do Backdoor Roth IRA in 2021?

Can you still do Backdoor Roth IRA in 2021?

The mega backdoor Roth allows you to put up to $38,500 of after-tax dollars in a Roth IRA or Roth 401(k) in 2021, and $40,500 in 2022.

What is the deadline to convert to a Roth IRA for 2020?

December 31

Is it too late to open a Roth IRA for 2021?

There is no age limit to open a Roth IRA, but there are income and contribution limits that investors should be aware of before funding one.

Are Back Door Roth conversions going away?

This would be the second-best scenario since those who had already done their Backdoor conversion for 2022 would be grandfathered in. The new bill is passed and the Backdoor Roth is demolished, and Congress makes it retroactive to the beginning of 2022.2022-01-16

What is the deadline for Backdoor Roth IRA?

If Back-Door ROTHs are prohibited by Build Back Better Act budget reconciliation legislation and signed into law, individuals phased-out of contributing to Traditional and ROTH IRAs can still contribute to a non-deductible IRA by .2021-12-14

How do you set up a backdoor Roth?

– Step 1: Contribute to a traditional IRA.
– Step 2: Immediately convert your traditional IRA to a Roth IRA.
– Step 3: Repeat the process, if you wish.

Can I do a Roth conversion for 2021 in 2022?

On April 5, you could convert your traditional IRA to a Roth IRA. However, the conversion can’t be reported on your 2021 taxes. Because IRA conversions are only reported during the calendar year, you should report it in 2022.

Can you still do Backdoor Roth IRA in 2022?

As of March 2022, the Backdoor Roth IRA is still alive. Therefore, any taxpayer making more than $214,000 in income and is married and filing jointly can make an after-tax Traditional IRA contribution and then potentially do a tax-free Roth IRA conversion.

Is it too late for a backdoor Roth IRA?

Backdoor Roth IRA Pitfall #2: The 5-Year Rule There’s just one limit on this feature: You have to wait five years after making your first contribution to avoid taxes when taking withdrawals from the account. The five-year clock starts ticking on January 1 of the year you made your first contribution.2021-12-22

Can you still do a backdoor Roth IRA in 2020?

9, 2021. The “backdoor Roth” tax strategy used largely by wealthy retirement savers and slated to be killed next year has survived — for now. The loophole lets rich 401(k) and individual retirement account owners save in a Roth-style account, shielding future investment growth from tax.2021-12-20

When can you do a Roth conversion for 2021?

You must do your conversion by , if you want your five-year countdown to begin on Jan. 1, 2021.2021-11-10

Can I contribute to a backdoor Roth?

Key Takeaways. High-income earners who can’t contribute directly to a Roth IRA may be able to contribute indirectly via a backdoor Roth and maximize their retirement savings.

Can I still do a backdoor Roth for 2020?

Though backdoor Roth IRAs were threatened by the Build Back Better Act, this bill appears to have stalled as of March 2022. For now, it seems that backdoor Roth IRAs are safe.

Is backdoor Roth still available?

Although the future of the backdoor Roth is still up in the air, high-income heavy savers can still take advantage of the maneuver. The backdoor Roth maneuver has become part of Tax Planning 101 for higher-income investors, enabling them to indirectly make Roth IRA and even Roth 401(k) contributions.2022-01-21

How to Set Up a Backdoor Roth IRA – Investopedia

A backdoor Roth can be created by first contributing to a traditional IRA and then immediately converting it to a Roth IRA (to avoid paying taxes on any earnings or having earnings that put you

Backdoor Roth IRA: What It Is and How to Set One Up

Here’s a step-by-step guide on how to make a backdoor Roth IRA conversion: Put money in a traditional IRA account. You might already have an account, or you might need to open one and fund it. (If

How to Set Up a Backdoor Roth IRA | Banks.com

The backdoor Roth is usually only worth considering if your income exceeds the contribution limits on a Roth IRA. As of 2021, if you have an income higher than $140,000 as a single tax filer or $208,000 as a married couple filing jointly, you won’t be able to contribute to a Roth IRA.

Backdoor Roth IRA: What it is and the benefits of setting

A backdoor Roth IRA can be relatively easy to set up, but you’ll want to carefully consider the potential costs and tax liabilities of doing so (more below). Here are the key steps: 1. Make a contribution to a non-deductible traditional IRA First, you’ll need to make a contribution into a non-deductible traditional IRA.

How To Do A Backdoor Roth IRA [Step – White Coat Investor

Despite its name, a Backdoor Roth IRA is not an account, it is a process with two steps: Contribute to a Traditional IRA. Complete a Roth conversion. If you understand the rules of both of these steps, putting them together is no problem. Who Should Do a Backdoor Roth IRA

How To Set Up A Backdoor Roth Ira Etrade – Investment

· Setting up a backdoor Roth IRA is simply a matter of contributing to a traditional IRA, then converting the money in the account into a Roth IRA and paying any taxes due on the conversion. You’ll also get some forms from your broker at tax time that you’ll have to file along with your taxes.

How To Set Up a Backdoor Roth IRA With Fidelity — Buck by

There are several ways to set up a Backdoor IRA. But for the sake of simplicity, I will focus only on converting a Traditional IRA to a Roth IRA using cash (instead of assets). 1) Open a Traditional IRA with Fidelity. Go to https://www.fidelity.com/retirement-ira/traditional-ira and follow their step-by-step guide. 2) Link a bank account.

What Is a Backdoor Roth IRA? And How Does It Work

How to Set Up a Backdoor Roth IRA. You might feel intimidated by the idea of doing a backdoor Roth IRA—just the name “backdoor” sounds a little insider-y—but the truth is it’s pretty simple. You can convert a traditional IRA into a Roth IRA in just a few easy steps: Step 1: Open up a traditional IRA.

How to fund your backdoor Roth IRA via E-Trade – 2021

The basic premise of funding a backdoor Roth IRA is to contribute first to a non-deductible traditional IRA, then make a conversion to a Roth IRA. Open and fund a Traditional IRA account After logging onto E*Trade, the upper right corner of the website should have an option to “Open Account”. Click that and you will get a list of accounts to open.

5 Steps to Opening a Roth IRA – Investopedia

5 Steps to Opening a Roth IRA It’s easy to get started By Jean Folger Updated Reviewed by David Kindness Fact checked by Vikki Velasquez Table of Contents 1. Make Sure You’re

How to Open a Roth IRA: Quick-Start Guide – NerdWallet

For 2022, up to $6,000 if your modified adjusted income is below $144,000 (single filers) or $214,000 (married filing jointly). If your income exceeds those limits, the backdoor Roth IRA strategy

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How to Set Up a Backdoor Roth IRA – Market Trading Essentials

A backdoor Roth can be created by first contributing to a traditional IRA and then immediately converting it to a Roth IRA (to avoid paying taxes on any earnings or having earnings that put you over the contribution limit).

How to Set up Backdoor Roth IRA with Charles Schwab under

In this video, I’m going to talk about what a Roth IRA is and why it’s a tax loophole plus a detailed walk-through on how to set it up in less than 5 minutes

How to Set Up a Backdoor Roth IRA – TradingSim

With a mega backdoor Roth IRA, high-income people can contribute up to $37,000 to a Roth. After an after-tax contribution to a traditional IRA, the IRA can be converted into a backdoor Roth. However, with a backdoor Roth IRA, an employer’s 401k may have to return the excess contribution.

How to Set Up a Backdoor Roth IRA | Nasdaq

Setting up a backdoor Roth IRA is simply a matter of contributing to a traditional IRA, then converting the money in the account into a Roth IRA and paying any taxes due on the conversion. You’ll

Mega Backdoor Roth IRA: How to Set Up Safely

Mega Backdoor Roth IRA: How to Set Up Safely. posted on February 5, 2022. The Mega Backdoor Roth takes investing in a traditional 401 (k) to the next level for high-income earners. If you meet the eligibility requirements, you could stash an extra $41,500 for retirement in a Roth IRA. However, it’s complicated, and mistakes can be costly.

Backdoor Roth IRA 2022: What Is It & How to Do It | Facet

Backdoor Roth IRA Conversion Rules & Limitations. There are limits to how much you can contribute when utilizing the backdoor Roth IRA strategy. As with traditional and Roth IRA contributions, the maximum amount you can contribute per year (for 2022) is $6,000 if age 50 and under, or $7,000 per year if age 50 or older.

How to Set Up a Backdoor Roth IRA – Fox Business

Setting up a backdoor Roth IRA is simply a matter of contributing to a traditional IRA, then converting the money in the account into a Roth IRA and paying any taxes due on the conversion. You’ll

What Is a Backdoor Roth IRA? And How to Set One Up

How to Set Up a Backdoor Roth IRA (Step-by-Step) Follow our steps to set up a backdoor Roth IRA right now. Step #1. Contribute to a Traditional IRA Account . Find a stock broker that offers traditional IRAs with a Roth IRA conversion option. Many brokers offer it but don’t assume. Read the fine print to make sure they have what you want.

How to Set Up a Backdoor Roth IRA at Vanguard – YouTube

Logan Allec CPA explains why you may need a Backdoor Roth IRA and how to set one up at Vanguard! Jump to 6:49 to get right into the step-by-step (everything

Taking Advantage of the Mega Backdoor Roth IRA Before it

At a basic level, the mega backdoor Roth IRA allows a specific subset of savers to put up to $40,500 into a Roth IRA by using their employer-sponsored 401(k) plan to make after-tax contributions

How to Set Up a Backdoor Roth IRA – Alma's Truth Search

A backdoor Roth might be created by first contributing to a standard IRA after which instantly changing it to a Roth IRA (to keep away from paying taxes on any earnings or having earnings that put you over the contribution restrict).

Ed Beusse on LinkedIn: About the "Backdoor Roth IRA"

Ed Beusse. Executive Director – Investments at Oppenheimer & Co. Inc. 4d. Report this post. Generally, the ability to contribute to a Roth #IRA is limited to individuals who earn below a certain

Instructions for Backdoor Roth IRA's – Fiscal Fitness News

Backdoor Roth IRAs are a frequently-discussed topic on physician blogs and social media sites. But most conversations assume you understand basic investing concepts that many novice investors don’t. I’ve written this post as a reference guide for anyone who needs help with the mechanics on how to set up a backdoor Roth IRA. Before you…

How to Set Up a Backdoor Roth IRA | ALEKBO.COM – News

The government clearly sanctioned the practice of contributing to a Roth through the backdoor. If you take advantage and maximize your retirement savings, you can obviate tens or even hundreds of thousands of dollars on taxes over the years. Keep reading to find out more all over this loophole and the benefits of setting up a backdoor Roth IRA.

When/How to worth with a Backdoor IRA : FinancialPlanning

The rollover and Roth are minimal. Under 6k combined. I also have a 401k that’s getting max contribution. Well 2. One with Millenium that’s an IRA from a rollover out of a company. And another that’s getting max contributions. I’m not really all that knowledgeable on who is the best to hold my ira’s or how to set them up.

How to Set Up a Backdoor Roth IRA – Web Investor News

In addition to a backdoor Roth IRA, there is a mega backdoor Roth IRA. That account is like a backdoor Roth on steroids. In a mega backdoor Roth, people who have a 401k that allows after-tax contributions. With a mega backdoor Roth IRA, high-income people can contribute up to $37,000 to a Roth.

What is an IRA (Individual Retirement Account) and How

An Individual Retirement Account (IRA) is a retirement savings account set up with a financial institution or brokerage firm that offers tax breaks for those investing income for their retirement. IRAs can be opened by an individual, self-employed individuals and small business owners. Backdoor Roth is a type of IRA for individuals with

How To Do A Backdoor Roth IRA – Setup Guide & Why It Might

How to set up a backdoor Roth IRA. Simply put, you have to put money in a traditional IRA, convert this account to a Roth IRA, pay some taxes and voila! Though you may have not been eligible to contribute to a Roth IRA, you’ve gone in through “the back door”, so to speak, and can now enjoy the benefit of growing your money tax-free

The Backdoor Roth IRA – IRA Financial Group

How to Set Up a Backdoor Roth IRA. You can convert a traditional IRA into a Roth IRA in just a few easy steps: #Step 1: Open up a traditional IRA and make your first contribution. #Step 2: Convert the traditional IRA funds into a Roth IRA. #Step 3: Pay the taxes you owe on the money you invested.

What Is a Backdoor Roth IRA and How to Set One Up

A backdoor Roth IRA is a tax strategy that can help make your retirement portfolio as efficient as possible. A regular Roth IRA can help boost your retirement savings with tax-free growth, but this type of individual retirement account is not available for people with incomes above certain thresholds.

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Backdoor Roth IRA 2022: A Step by Step Guide with Vanguard

I currently have a traditional IRA with Vanguard, approximately $500K invested and a Roth with Vanguard $5500. invested;From the article it sounds like I can not use my current IRA to backdoor to my current Roth but can I set-up a traditional IRA and Roth IRA with a different brokerage firm to do the first backdoor roth or did I misunderstand

Backdoor Roth IRA Ultimate Guide and – Take Point Wealth

I continue to receive regular inquiries about how to set up a Backdoor Roth IRA. As a result, I decided to create a basic step-by-step instructional that people can refer to when performing this task. Before I begin, keep in mind that you can donate DIRECTLY to a Roth IRA if you are a low-income earner and bypass this Backdoor Roth IRA method.

How to Set Up a Backdoor Roth IRA

Discover how a backdoor Roth IRA works, how to set one up, the rules to follow, and when a backdoor IRA might not be right for you. Education General Dictionary Economics Corporate Finance Roth IRA Stocks Mutual Funds ETFs 401(k) Investing/Trading Investing Essentials

How to fund your backdoor Roth IRA via E-Trade – 2021

The income phaseout for the Roth IRA begins at $125,000 and $198,000 for single and joint filers, respectively. This excludes most physicians, but we can still fund a Roth IRA. The following are the steps to do so through E*Trade. It is important to remember that in order for funding a backdoor Roth IRA to be a tax-neutral event, you must not

Backdoor Roth IRA Definition – Investopedia

Backdoor Roth IRA: A method that taxpayers can use to place retirement savings in a Roth IRA , even if their income is higher than the maximum the IRS allows for regular Roth IRA contributions

17 Backdoor Roth IRA Errors to Avoid | White Coat Investor

How to Do a Backdoor Roth IRA. Step #1 Contribute $6,000 ($7,000 if 50+) to a traditional IRA account during the calendar year, investing the money into a money market fund. Step #2 Convert to a Roth IRA the next day, investing the money into your selected investment fund. Step #3 Follow the written IRS instructions to fill out Form 8606

Explainer Video: Backdoor Roth IRA Strategy | Creative

How the Backdoor Roth IRA Strategy Works. With the backdoor strategy, you need to set up a traditional IRA account alongside your Roth IRA. You make the same $6,000 or $7,000 contribution to the traditional IRA but do so on an after-tax or non-deductible basis. That means you don’t take a tax deduction for putting money in the account.

Roth IRA Conversion: Everything You Need to Know About

They could then convert the Traditional IRA to a Roth IRA; hence the Backdoor Roth IRA was created. How to Set Up a Backdoor Roth IRA. To avoid possible penalties when converting a Traditional IRA to a Roth IRA you need to follow certain guidelines. Let’s take a look at how to proceed in 3 easy steps.

Mega Backdoor Roth IRA: Step-by-Step Setup with Fidelity

Mega backdoor Roth IRA is a great option to save for retirement for high income earners. It can be complicated to set up. We walk you through step-by-step setup with Fidelity.

Backdoor Roth IRAs: Everything You Need To Know (2021)

While the Backdoor Roth seems like a good way to invest into a Roth IRA even if you exceed the income limit, there are drawbacks. For one, an investor might not take into account the Pro-Rata rule when transferring their money from their traditional IRA into a Roth IRA, and end up being taxed more than they thought they’d be.

Backdoor Roth IRA: What it is and the benefits of setting

How to set up a backdoor Roth IRA. While income caps keep some individuals from contributing to a Roth, there are zero income restrictions on converting a traditional IRA to a Roth IRA. That means high-income investors can make nondeductible IRA contributions and then convert them to a Roth. A nondeductible contribution is one to a traditional

Solved: How do I enter a Back-door Roth IRA Conversion so

Remember this: “A “backdoor” Roth simply represents an amount put into an IRA post-tax, and immediately converted, avoiding any earnings that would be taxable.” “So line 1 on Form 8606 would be in this case $7,000. Line 2: Enter your total basis in traditional IRAs.” <== Basis, because it is post-tax.

Backdoor Roth IRA: What it is and the benefits of setting

A backdoor Roth IRA can be relatively easy to set up, but you’ll want to carefully consider the potential costs and tax liabilities of doing so (more below). Here are the key steps: 1.

What Is a Backdoor Roth IRA? | The Motley Fool

Backdoor Roth IRA contribution limit. The IRA contribution limit for 2021-22 is $6,000 per person, or $7,000 if the account owner is 50 or older. So if you want to open an account and then use

Explaining the Backdoor Roth and Mega Backdoor Roth IRA

Assuming you can do a mega backdoor Roth, here’s how it works: You max out individual additions to your 401 (k): $19,500 in 2021 or $26,000 if 50+. Then, you make after-tax (non-Roth) contributions up to the annual maximum (combined employee and employer). In 2021, this is $58,000 ($64,500 if 50+). If your employer offers matching or profit

Backdoor Roth IRA – Stocks4Docs

Lastly, when discussing the eligibility for a Roth IRA and the upper-cap of $129,000 in gross income that is required for single filers (or up to $204,000 for joint filings), we briefly touched upon the concept of a ‘Backdoor Roth IRA’ for those who do not quite make the cut as they earn more than the upper-ceiling required for the Roth IRA.

How to setup a Backdoor Roth IRA in Fidelity – YouTube

Backdoor Roth IRAs are great. They folks who don’t normally qualify for a Roth IRA still take advantage of one! I mean, who doesn’t want to have their money

Backdoor Roth IRAs: The Loophole You Should Know | Candor

A backdoor Roth IRA is a strategy that allows high-income people to save for retirement. There are a few ways to create a backdoor Roth IRA and this article will explain in detail what a backdoor Roth IRA is, how someone can open one, and who a backdoor Roth IRA is right for.

Backdoor Roth IRA: A step-by-step guide at Vanguard – The

Today, we will discuss exactly how to set up your first Backdoor Roth IRA at Vanguard. If it’s your first time performing a Backdoor Roth IRA, you may want more information after reading through this post on how to perform $24,000 in one year (if married) or $12,000 (if single).

Mega Backdoor Roth : My Step by Step How-To Guide

A mega backdoor Roth is a powerful way to get a boatload of money into a Roth IRA. You can go well beyond the $6k limit in 2021 up to as much as $38.5k a year.

How to Make Backdoor Roth IRA Contributions

Backdoor Roth IRA contributions are essentially a three-step process: Make a non-deductible contribution to your traditional IRA, Convert your IRA into a Roth IRA, and. Properly fill out Form 8606 and include it with your taxes. The reason this works is because you’re making a non-deductible IRA contribution.

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What Is a Backdoor Roth IRA? – SmartAsset

How to Set Up a Backdoor Roth IRA. Setting up a backdoor Roth IRA is much simpler than it may initially seem. It’s just an act of conversion. In essence, you’ll be converting your Traditional IRA into a Roth IRA by wholly switching the account and paying the taxes owed on your former traditional IRA contributions, as well as on any gains

What is a Backdoor Roth IRA? | Income Limits and Rollovers

How to Set up a “Backdoor” Roth IRA Convert a Traditional IRA Into a Roth IRA. This method may be the easiest since all it requires is a conversion of an already-existing IRA into a Roth. This will be a significant benefit if you realize that your tax bracket will likely be higher in the future.

Backdoor Roth IRA Fidelity – Metals Resource – April 2022

The backdoor Roth IRA is a retirement account that you can put money into even if you don’t earn a lot. There are limits to how much you can put into a Roth IRA. But there is a way around these limits. The backdoor Roth IRA is when you put money in a regular IRA and then transfer it to a Roth IRA.

How To Set Up a Mega Backdoor Roth With Fidelity — Buck by

How To Set Up a Mega Backdoor Roth With Fidelity. In this step-by-step guide, I will walk through the steps to set up a Mega Backdoor Roth with Fidelity. Specifically, I will outline the steps to set up an Mega Backdoor Roth using an “in-plan conversion” (as opposed to the tedious and tax-ineffective “in-service conversion”).

Mega Backdoor Roth Step by Step – FiPhysician

My Mega Backdoor Roth IRA Rollover—In-Service Distribution. Around mid-December, it was time to call her custodian and rollover the after-tax money into a Roth IRA. She had already set up a Roth IRA to receive the rollover. Since it was $50 a pop to make an in-service distribution and a long wait on the phone, I only did one distribution this

Can I change my Roth IRA to a traditional? – AnswersData

The Mega Backdoor Roth IRA – coined by Jim Dahle at The White Coat Investor – is a strategy that allows you to contribute up to $36,000 per year to your Roth IRA, on top of your other retirement savings, without any income restrictions.

How to do a Backdoor Roth IRA on TD Ameritrade

Hi, I have a traditional IRA and a Roth IRA on TD. The traditional account has a negligible amount of money in it (~$100). Are the steps as simple as this? Deposit 6k into traditional IRA. Transfer the 6k to the Roth IRA using the new online Roth conversion tool (looks like it just does a regular internal transfer between linked accounts?).

Mega backdoor from Microsoft 401k in fidelity – Blind

I wrote this up back in 2017. How to do the Mega backdoor Roth at Microsoft into your personal Roth IRA. If you don’t already have a personal Roth IRA. 1. Login at fidelity.com 2. At the very top navigation click the “Open an account” link. 3. Click the “Open a Roth IRA” button and go through the process to create a personal Roth IRA.

How To Set Up A Roth Ira Vanguard – Investment & Finance News

Step 2: Set Up A Roth IRA. See the article : How To Do A Partcial Transfer From Traditional Ira To Roth Ira. Once you’ve logged in to vanguard’s site, expand the “Investing” menu and click IRAs: Roth & traditional. On the next screen, click “Open your IRA today”. You’ll need your bank’s routing number and your account number to

How to do backdoor Roth on fidelity? – The White Coat

Currently I have 2 rollover IRA accounts with Fidelity. One is at zero dollars, the other around 7200. I also have a Roth IRA account that’s already set up. I’m a little confused about the pro rata rule and if that would apply to the one rollover account with money in it. Do I need to move that money in order to do backdoor Roth?

Mega Backdoor Roth – Millennial Money

Beyond the backdoor Roth IRA, is the mega backdoor Roth IRA, which allows you to contribute up to $37,500 to your Roth IRA or Roth 401k on top of additional retirement savings. It’s a complicated process, but the results are well worth it if you can make it work.

Fidelity – Backdoor Roth IRA – how to handle each year

Fidelity – Backdoor Roth IRA – how to handle each year? I would like to set up a Backdoor Roth IRA. My question is about the step that indicates: “Leave my account open, I may fund in the future”. This this will be my first year doing it, but I seem to understand the process.

Mega Backdoor Roth through Fidelity Investments | CerebralTax

The Mega Backdoor Roth is a strategy that enables physicians to contribute up to an additional $37,500 (2020) by contributing after-tax dollars to your after-tax IRA and converting that money into a Roth Solo 401k. We’re going to run through how that works using Fidelity Investments as an example and what you need to do to report it.

Fidelity Roth Ira Automatic Investment

In this step-by-step guide, I will walk through the steps to set up a Backdoor Roth IRA with Fidelity. If you dont know the benefits of a Roth IRA , check out my post on Roth IRA vs 401 first. After reading it, youll know that performing a Backdoor IRA conversion is only useful if your 2022 income is above $129K or $204K .

The Mega Backdoor Roth – A Hidden 401(k) Benefit – Alterra

Microsoft led the way in creating a rarely utilized benefit within their 401(k) plan – the after-tax Roth conversion, or Mega Backdoor Roth. Other companies are slowly adopting this plan feature. Beyond the standard maximum contribution and any matching, the IRS allows non-deductible contributions up to a total of $58,000 from all sources in

23 Ridiculous Tax Loopholes

The Backdoor Roth IRA Loophole Some income restrictions apply for people who contribute to a Roth IRA, which allows you to set aside after-tax money for retirement and withdraw it, including gains

Guys – I have been ignorant on IRA concept. I max out on

Response 1 of 7: Backdoor Roth IRA only. Assuming you don’t have a traditional Ira balance currently, it is very easy. Response 1 of 7: Backdoor Roth IRA only. Assuming you don’t have a traditional Ira balance currently, it is very easy Any RSM tax people . so I applied at RSM and recruiter reached out to me to set up a brief phone

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