Complete guide
Reviewed July 2026The backdoor Roth IRA — contributing to a non-deductible traditional IRA and immediately converting to Roth — is a legal, widely used strategy for high earners above the direct Roth contribution income limits. Its one trap is the pro-rata rule: the IRS treats all your traditional, SEP and SIMPLE IRAs as a single pot, so if you hold pre-tax IRA money anywhere, part of every conversion is taxable — you cannot choose to convert only your after-tax basis.
This calculator applies the exact pro-rata math from IRS Form 8606: enter your total pre-tax IRA balances, your after-tax basis, and the amount you're converting, and it returns the taxable portion, the tax-free portion, and the estimated tax at your marginal rate.
If the result surprises you, you're not alone — the pro-rata rule is the single most common and most expensive backdoor Roth mistake, and it's discovered by most people only at tax time.
The pro-rata rule explained
Taxable % = Pre-tax IRA balance ÷ (Pre-tax balance + After-tax basis) Taxable amount = Conversion × Taxable % Balances measured across ALL traditional, SEP and SIMPLE IRAs as of December 31 of the conversion year (Form 8606, line 6).
Two features do all the damage. Aggregation: every traditional, SEP and SIMPLE IRA you own counts as one account — including that old rollover IRA from a previous job. Year-end timing: the ratio uses your December 31 balance, so a rollover into an IRA even after your conversion, in the same calendar year, retroactively poisons the math.
Not counted: 401(k)/403(b)/457 balances, inherited IRAs (separate calculation), and your spouse's IRAs — the rule applies per person.
Clean backdoor: the way it's supposed to work
- You have $0 in pre-tax traditional/SEP/SIMPLE IRAs.
- Contribute $7,000 non-deductible to a traditional IRA (2025 limit; verify the current year's).
- Convert to Roth days later, before meaningful earnings accrue.
- Taxable % = 0 ÷ (0 + 7,000) = 0%. Tax owed: $0 (aside from pennies of interim earnings).
- File Form 8606 documenting the basis and conversion.
Poisoned backdoor: the pro-rata trap
- You have a $95,000 pre-tax rollover IRA from an old 401(k).
- Contribute $7,000 non-deductible and convert $7,000.
- Taxable % = 95,000 ÷ (95,000 + 7,000) = 93.1%.
- Taxable amount = 7,000 × 93.1% = $6,520 — taxed as ordinary income (~$1,565 at 24%).
- Your $480 of tax-free conversion barely moved the needle, and $6,520 of basis is now spread across the remaining IRA, recoverable only through future pro-rata conversions.
How to fix the pro-rata problem
The reverse rollover (the standard cure)
Roll your pre-tax IRA balances into your current employer's 401(k) or 403(b) — employer plans are excluded from the pro-rata calculation. Once the IRA holds only after-tax basis (or $0), the backdoor is clean. Most large-employer plans accept 'roll-ins'; confirm the plan takes IRA rollovers and complete it before December 31 of the conversion year. Self-employed? A solo 401(k) that accepts rollovers achieves the same thing.
Other options
- Convert everything: if the pre-tax balance is modest, converting the whole IRA in a low-income year clears the deck permanently — pay the tax once, all future backdoors are clean.
- Accept partial taxation: at high pre-tax balances this means most of each conversion is taxable — usually better to fix via rollover first.
- Spousal asymmetry: the rule is per-person, so a spouse with no pre-tax IRAs can run clean backdoors even if you can't.
- Don't bother hiding contributions in separate accounts — aggregation ignores account boundaries completely.
Form 8606: the paperwork that protects you
File Form 8606 for every year you make a non-deductible contribution and every year you convert. It tracks your basis (already-taxed money) so it's never taxed twice. Missing 8606s are the second-most-common backdoor error — reconstruct and file them late if needed (there's a modest penalty but the basis protection is worth far more).
Using this calculator
- Add up the pre-tax balances in every traditional, SEP and SIMPLE IRA you own (use projected December 31 values).
- Enter your after-tax basis — total non-deductible contributions from prior Form 8606 filings plus this year's.
- Enter the amount you plan to convert and your marginal tax rate.
- Read the taxable and tax-free portions. If the taxable % isn't near zero, execute a reverse rollover before converting — or size the conversion deliberately as a taxable Roth conversion.
Frequently asked questions
Glossary
- Pro-rata rule
- The requirement that conversions draw proportionally from pre-tax and after-tax money across all your IRAs.
- Basis
- After-tax (non-deductible) contributions in your IRAs, tracked on Form 8606 — never taxed twice.
- Form 8606
- The IRS form reporting non-deductible contributions, conversions and the pro-rata computation.
- Aggregation rule
- Treating all traditional, SEP and SIMPLE IRAs as one account for taxation of distributions and conversions.
- Reverse rollover
- Moving pre-tax IRA money into an employer plan to exclude it from pro-rata math.
- Roth conversion
- Transferring traditional (pre-tax or basis) money to a Roth account, taxable on the pre-tax portion.
- Mega backdoor Roth
- Converting after-tax 401(k) contributions to Roth, outside IRA aggregation.
- MAGI
- Modified adjusted gross income — the measure conversions raise, affecting IRMAA and ACA subsidies.
- Recharacterization
- The now-repealed (2018) ability to undo a Roth conversion.
Key takeaways
The backdoor Roth works perfectly with zero pre-tax IRA balances and painfully with any: taxable % = pre-tax ÷ total across every IRA you own, measured December 31. Before converting: total your IRAs, run this calculator, roll pre-tax money into a 401(k) if needed, convert promptly, and file Form 8606. The rule can't be outsmarted with separate accounts — only with sequencing.
Enter your balances above to see your true taxable percentage — if it isn't near zero, fix the pro-rata problem before you convert, not at tax time.