These Year-End Retirement Plan Adjustments Could Transform Your Wealth Discover two strategies that could help you contribute more to your Roth IRA.

This article is part of the End of Year Tax Tips Series from tax and legal expert Mark J. Kohler.

You know you want to contribute more to your retirement plan. However, maybe you have heard vicious rumors that there are income limits, and you make too much money to contribute to a Roth IRA. Well, guess what? Christmas just came early! You can contribute to a Roth IRA through a conversion strategy.

I also want to introduce the strategy of "chunking." The only caveat is, the deadline to take advantage of this strategy is Dec. 31.

Why does a Roth IRA make sense?

Many investors and financial professionals are familiar with the primary benefits of a Roth IRA: The plan's investments grow tax-free and come out tax-free. But if tax-free investing isn't enough to get you excited, rest assured, there are more benefits to Roth IRAs.

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First, Roth IRAs are not subject to RMDs. Traditional retirement plan owners are subject to rules known as Required Minimum Distribution rules, which require the account owner to start taking distributions and paying tax on the distributions (since traditional plan) when the account owner reaches the age of 70-and-a-half. Not being subject to RMD rules allows the Roth IRA to keep accumulating tax-free income (free of capital gain or other taxes on its investment returns) and allows the account to continue to accumulate tax-free income during the account owner's lifetime.

Second, a surviving spouse of a Roth IRA has special options. A spouse who is the beneficiary of a Roth IRA can continue contributing to that Roth IRA or can combine that Roth IRA into his or her own Roth IRA. Allowing the spouse beneficiary to take over the account allows additional tax-free growth on investments in the Roth IRA account.

Third, Roth IRA owners are not subject to the 10 percent early withdrawal penalty. This is for distributions taken before the age of 59-and-a-half on amounts comprised of contributions or conversions. Growth and earnings are subject to the early withdrawal penalty and taxes, too, but you can always take out the amounts you contributed to your Roth IRA or the amounts that you converted without paying taxes or penalties. (Note that conversions have a five-year waiting period before you can take out funds penalty and tax-free.)

The "back door" deadline: Dec. 31.

Roth IRAs can be established and funded for high-income earners by using what is known as the back door Roth IRA contribution method. Many high-income earners believe that they can't contribute to a Roth IRA because they make too much money and/or because they participate in a company 401(k) plan. Fortunately, this thinking is wrong. While direct contributions to a Roth IRA are limited to taxpayers with income in excess of $129,000 ($191,000 for married taxpayers), those whose income exceeds these amounts may make annual contributions to a non-deductible traditional IRA and then convert those amounts to a Roth IRA.

The strategy used by high-income earners to make Roth IRA contributions involves the making of non-deductible contributions to a traditional IRA and then converting those funds in a non-deductible traditional IRA to a Roth IRA. This is often referred to as a back door Roth IRA. In the end, you don't get a tax deduction for the amounts contributed, but the funds are held in a Roth IRA and grow and come out tax-free upon retirement (just like a Roth IRA).

YEAR-END TIP: Convert at least some of your IRA funds to a Roth IRA by Dec. 31. You can always change your mind in the spring.

If you change your mind, there's always re-characterization.

If you convert any funds to a Roth IRA in 2016, but you change your mind after you assess the value of the assets a few months later, or the amount of tax on the conversion, you can reverse the conversion by doing what is called a Roth IRA conversion re-characterization.

Under a re-characterization, Roth IRA funds and assets are rolled back into a traditional IRA, the amounts converted are considered contributed to the traditional IRA and you effectively cancel out the amounts converted. As a result of the re-characterization, the taxes that would have been owed for the Roth IRA conversion are no longer due, and the re-characterized assets and funds go back to a traditional IRA.

Related: 10 Flaws of Conventional Retirement Plans

A Roth IRA conversion re-characterization is an excellent strategy in two situations. First, it is beneficial if you do not have the funds to pay the taxes on the conversion. Reversing the re-characterization will remove the tax liability. Problem solved.

Second, if the investments in your Roth IRA, following the conversion, did not fare so well, and if the account decreased in value, you are generally better off re-characterizing the conversion, going back to a traditional IRA and then conducting a new Roth IRA conversion at the lower valuation. If you have completed a Roth IRA conversion re-characterization, you do have to wait until the next year to convert the same amounts back to Roth, as the IRS restricts you from immediately re-converting after a re-characterization.

The Roth IRA chunking strategy.

As you can imagine, this is a quite straightforward strategy. Basically, don't try and convert all of your IRA funds to a Roth IRA in one year. Make a calculated plan to convert a certain amount or percentage of your IRA each year until you get to the Roth IRA goal amount you set for yourself.

The beauty of this strategy is that you can fall back on re-characterization (see above) if you bite off more than you can chew in any given year. However, if you plan it carefully, you can keep yourself in the tax bracket you want and can afford -- and also know that you are making headway.

For example, you have $100,000 in a traditional IRA, and if you converted these funds all at once to a Roth IRA, you could go up about three tax brackets. Take a chunking approach and convert $20,000 a year for the next five years to hit your contribution goal of $100,000 and keep yourself in a lower tax bracket along the way.

Related: Who Wants to Be a Millionaire? Top 10 Hacks for Having $1 Million for Retirement.

The bottom line is, if you want to take advantage of any of these Roth IRA benefits or strategies, you have to file the appropriate paperwork to convert your desired funds by Dec. 31. Talk to the custodian of your IRA to fill out the proper paperwork before the deadline, and reassess your situation in the spring to determine if you need to re-characterize some or all of the funds.