Backdoor Roth IRA Calculator
See benefits of the backdoor Roth strategy for high earners.
Backdoor Roth vs Taxable
Important Notice
These calculators are for educational and informational purposes only. Results are estimates based on the information you provide and should not be considered financial, tax, or investment advice. Your actual results may vary. For personalized guidance, please consult a qualified financial advisor, tax professional, or other appropriate expert.
People Also Ask
What is a backdoor Roth IRA?
A backdoor Roth is a two-step process: 1) Contribute to a non-deductible traditional IRA, 2) Convert to Roth IRA. This lets high earners get money into Roth accounts despite income limits.
Is the backdoor Roth still legal?
Yes, as of 2024. The strategy has been used for years and the IRS has not challenged it. Proposed legislation to eliminate it has not passed. Always consult a tax professional for your situation.
What is the pro-rata rule?
If you have other traditional IRA balances, conversions are proportionally taxable. Example: $94,000 pre-tax + $6,000 non-deductible = $100,000 total. Converting $6,000 would be 94% taxable ($5,640).
How do I avoid the pro-rata rule?
Roll existing traditional IRA balances into your 401(k) before converting. This leaves only non-deductible contributions in your traditional IRA, making the conversion tax-free.