Backdoor Roth IRA Pro-Rata Calculator
If you have any pre-tax money in a traditional or rollover IRA, the IRS pro-rata rule makes your Roth conversion partially taxable, even if you only contributed after-tax dollars. Calculate exactly how much of your conversion is taxable and what Form 8606 will show.
How this calculator works and the math behind itThe pro-rata problem explained
Many high earners discover the backdoor Roth strategy and assume they can simply contribute $7,000 after-tax and convert $7,000 tax-free. This works perfectly if your total traditional IRA balance is $0 at year end. But if you have a rollover IRA from an old 401(k), the pro-rata rule applies.
The IRS calculates the taxable portion of your conversion as (pre-tax IRA balance / total IRA balance). A $150,000 rollover IRA plus a new $7,000 after-tax contribution equals a $157,000 pool. Converting $7,000 produces a 95.5% taxable conversion -- $6,685 of your $7,000 conversion is taxable at ordinary income rates. That is the opposite of what most people expect.
The calculation looks at your December 31 IRA balance for the year of the conversion, not the balance at conversion time. You cannot convert early in the year and then roll pre-tax money into a 401(k) afterward to retroactively fix the pro-rata calculation.
Frequently asked questions
What is the backdoor Roth strategy?
Make a non-deductible traditional IRA contribution, then immediately convert to Roth. Designed for high earners over the direct Roth contribution income limit. Works cleanly only if you have no other pre-tax IRA money.
What is the pro-rata rule?
IRS rule (IRC § 408(d)(2)) that treats all your traditional IRA money as one pool. Taxable % = pre-tax balance / total IRA balance. You cannot segregate after-tax contributions for tax-free conversion when you have pre-tax money.
How do I fix the pro-rata problem?
Roll your pre-tax IRA money into your current employer 401(k) before year end. With zero pre-tax IRA balance at December 31, your after-tax contribution converts entirely tax-free.
Which IRA accounts count in the pro-rata calculation?
All traditional IRAs, rollover IRAs, SEP-IRAs, and SIMPLE IRAs. Roth IRAs, 401(k)s, and 403(b)s do NOT count. Use the December 31 balance for the year of conversion.
What form reports a backdoor Roth?
Form 8606 filed with your tax return. Reports non-deductible contributions (Part I) and Roth conversions (Part II). Line 14 tracks your remaining after-tax basis year over year.