Backdoor Roth IRA Calculator

What is the backdoor Roth IRA?

A direct Roth IRA contribution is off-limits once your modified adjusted gross income (MAGI) exceeds the phase-out threshold. For 2026 (per IRS Notice 2025-67), the phase-out begins at $153,000 for single filers and heads of household, and at $242,000 for married filing jointly. Above $168,000 (single) or $252,000 (MFJ), the direct contribution is fully disallowed.

The backdoor strategy works around this limit: (1) make a nondeductible contribution to a traditional IRA — the deductibility phase-out does not affect your right to contribute, only your right to deduct — and then (2) convert that traditional IRA balance to a Roth IRA. In isolation, the conversion of after-tax dollars is a tax-free event — you are simply moving money that has already been taxed into a Roth wrapper.

The pro-rata rule is what makes it complicated.

What is the pro-rata rule?

Under IRC §408(d)(2), the IRS treats all of your traditional, SEP, and SIMPLE IRAs as a single aggregated pool when calculating the taxable fraction of any distribution or conversion. You cannot tell the IRS to convert only the after-tax dollars — the IRS applies the basis fraction proportionally across the entire pool.

The formula, which mirrors the calculation on Form 8606 lines 5–18, is:

taxable fraction = pre-tax balance ÷ (pre-tax balance + after-tax basis)
tax-free amount = (1 − taxable fraction) × amount converted
taxable amount = amount converted − tax-free amount

The aggregation pool includes all traditional, SEP, and SIMPLE IRAs you hold at any institution. Crucially, 401(k), 403(b), and 457(b) employer-sponsored plans are excluded by law, as are Roth IRAs and inherited IRAs (IRS Pub 590-B). Failing to include every traditional, SEP, and SIMPLE IRA balance overstates how much of the conversion is tax-free.

The pro-rata trap — a worked example

Suppose you earn above the Roth income limit. In 2026 you make a $7,500 nondeductible contribution to a traditional IRA and immediately convert $7,500 to a Roth. So far so good — except you also hold $42,500 in a traditional IRA from an old 401(k) rollover that was never converted.

The IRS sees a total pool of $50,000 ($7,500 basis + $42,500 pre-tax). Your after-tax basis is only 15% of the pool, so only 15% of the conversion is tax-free:

taxable fraction = $42,500 ÷ $50,000 = 85%
tax-free amount = 15% × $7,500 = $1,125
taxable amount = $7,500 − $1,125 = $6,375

Instead of a tax-free conversion, you owe ordinary income tax on $6,375 — approximately $1,530 at a 24% marginal rate. The $42,500 rollover balance, which you intended to leave alone, determines the tax outcome on the new contribution you were converting.

This is the pro-rata trap: the IRS does not care which dollars you think you are converting.

How to achieve a clean backdoor — the $0 taxable case

When your pre-tax IRA balance is zero, the taxable fraction is zero and the entire conversion is tax-free. This is the clean backdoor. There are three ways to get there:

• Never made deductible contributions and have no rollovers. Your only traditional IRA activity has been nondeductible contributions, leaving a pool that is 100% basis.
• Reverse rollover before December 31. Roll your pre-tax traditional IRA balance into your current employer's 401(k) or 403(b) plan (if the plan accepts incoming rollovers). The IRS measures your IRA balance on December 31 of the year of conversion, so the rollover must be complete before year-end to avoid the pro-rata calculation for that year.
• Already converted all pre-tax balances in prior years. Once the pre-tax balance reaches zero through prior conversions, the backdoor is clean in subsequent years.

Form 8606 — why it matters

Form 8606, "Nondeductible IRAs," is how the IRS tracks your after-tax basis. You must file it in any year you make a nondeductible IRA contribution or convert a traditional IRA to Roth. If you fail to file, the IRS has no record of your basis, and you may pay taxes twice — once when you contributed, and again when you withdraw the same after-tax dollars in retirement.

This calculator mirrors the Form 8606 Part I and Part II math: after-tax basis (line 6), conversion amount (line 8), the nontaxable fraction (line 10), the tax-free amount (line 11), and the taxable amount (line 18). The "Show your work" panel above displays each line value for your inputs so you can cross-check your own return.

Rounding note: The Form 8606 line 10 instruction directs taxpayers to round the nontaxable fraction to at least 3 decimal places before applying it. This calculator computes the exact (unrounded) fraction, which can produce a taxable figure a few dollars different from a hand-filled form rounded to 3 decimal places. For example, with $20,000 pre-tax and $8,600 basis, the 3-decimal hand-fill produces a taxable amount of $6,011.40, while the exact calculation gives $6,013.99 — a $2.59 difference. Both are legally correct; the discrepancy is a rounding-convention artifact, not an error.

What this calculator does not model

• Single-year snapshot only. The tool computes one year's pro-rata result. It does not track basis carryforward across multiple years. If you have prior unrecovered basis, include it in your after-tax basis input — it appears on your prior-year Form 8606, line 14.
• No five-year clock modeling. Two distinct five-year rules govern Roth IRA qualification for penalty-free withdrawal: one for the account's first contribution, and one per conversion. This tool computes the taxable amount only — it does not determine when converted funds can be withdrawn. See IRS Pub 590-B or consult a tax advisor.
• Mega backdoor not modeled. The mega backdoor (after-tax contributions to a 401(k) plan converted in-plan or rolled out to a Roth IRA) is a separate strategy governed by plan rules and different limits. It is not computed here.
• Single federal marginal rate — not a bracket calculation. The estimated federal tax cost uses one rate you supply. Real tax liability depends on your total income, filing status, deductions, other credits, and bracket structure. State income taxes are not modeled.
• No income-eligibility check. The calculator does not verify whether your MAGI exceeds the Roth phase-out limit. The 2026 thresholds ($153,000–$168,000 single/HoH and $242,000–$252,000 MFJ, per IRS Notice 2025-67) are shown above as context for why the backdoor is used — they are not modeled as an input.
• 2026 U.S. federal — staleness-review item. IRA contribution limits and Roth phase-out thresholds are adjusted annually by the IRS, typically in October or November. Verify current figures at irs.gov before contributing.

2026 IRA contribution limits

Per IRS Notice 2025-67, the 2026 IRA contribution limit is $7,500 for taxpayers under age 50 and $8,600 for those age 50 and older (catch-up contribution included). Traditional IRA nondeductible contributions are available regardless of income level or workplace plan coverage — the income limit applies only to the deductibility of the contribution, not to the right to contribute.

Frequently asked questions

Can I convert just the after-tax portion and leave the pre-tax balance alone?

No. The pro-rata rule does not allow selective conversion. The taxable fraction applies to every dollar converted, regardless of which IRA you are converting from or which dollars you intend to move.

Does my 401(k) balance count in the pro-rata pool?

No. 401(k), 403(b), and 457(b) employer-sponsored plan balances are excluded from the pro-rata pool by law (IRS Pub 590-B). Only traditional, SEP, and SIMPLE IRA balances are aggregated. This is why the reverse rollover works: moving pre-tax IRA dollars into a 401(k) removes them from the pool before December 31.

Do I owe taxes on the entire conversion amount?

Only on the taxable fraction. If your pre-tax balance is zero (clean backdoor), the conversion is entirely tax-free. If your pre-tax balance is large relative to your basis, most of the conversion will be taxable ordinary income.

What happens to my remaining basis after the conversion?

Your remaining after-tax basis equals your prior basis plus any new nondeductible contribution, minus the tax-free amount recovered in this year's conversion. Track it on Form 8606 each year — the balance on line 14 carries forward to future years. Losing track of basis leads to double taxation on later withdrawals.

Sources: IRS Form 8606 (2026) · IRS Publication 590-B · IRC §408(d)(2) (aggregation rule) · IRS Notice 2025-67 (2026 IRA limits)

This tool is for informational and educational purposes only. It is not financial, tax, or legal advice. IRA and Roth conversion rules are complex and individual. Consult a qualified tax or financial professional before making contribution or conversion decisions.

Last reviewed: June 2026 · Figures per IRS Notice 2025-67.