qbteachmt
Level 15
04-18-2023
12:41 PM
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"Backdoor" conversions still exist. All that means is the nondeductible contribution to a Trad IRA is converted to Roth. It's the exact same thing as you described. However, what people overlook is:
You need to do it right away to avoid that nondeductible contribution having any earnings, which are going to create the pro rata taxable condition.
You need to have only basis in that and any other similar type of Trad account (pretax, such as SEP IRA and SIMPLE IRA), or by definition it is pro rata conversion.
And, any earnings in any of these accounts (anything never taxed or pre-tax) always creates pro rata conversion.
"Backdoor" is a timeliness word. Conversion is conversion.
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