If your income has climbed past the Roth IRA limit, you've probably been doing a lot of things right for a long time: saving steadily, filling the 401(k), building a career. The reward is that you can no longer contribute to a Roth directly. For 2026, that ability starts phasing out at $153,000 of income for single filers and $242,000 for married couples filing jointly, and it's gone entirely at $168,000 and $252,000.
A backdoor Roth IRA is how households above those lines still get money into a Roth. It's two ordinary transactions done in the right order, plus one rule that deserves more attention than the rest.
How the Back Door Works
The tax code puts an income limit on Roth IRA contributions, but it puts no income limit on Roth conversions. The backdoor Roth uses the second rule to get around the first: you contribute to a traditional IRA without taking a deduction, since your income is too high for one, and then convert that money to a Roth.
For 2026, the most that can go through this door is $7,500 per person, or $8,600 if you're 50 or older.
How to Perform a Backdoor Roth Contribution in 6 Steps
- Confirm your income is above the Roth threshold. If it isn't, you can contribute to a Roth directly and none of the rest applies.
- Confirm you have no money in pre-tax IRAs. That means traditional, SEP, SIMPLE, and rollover IRAs. This is the step the next section is about.
- Contribute the year's maximum to a traditional IRA from your bank or brokerage account, and don't take a deduction for it.
- Convert the full balance to a Roth IRA, ideally soon after, because anything the money earns between the contribution and the conversion is taxable when you convert.
- Invest the money once it's in the Roth. A conversion moves the dollars but doesn't invest them, and cash left sitting in a Roth isn't doing the job you opened it for.
- File Form 8606 with your tax return. This is the form that tells the IRS the contribution was made with money you'd already paid tax on. Without it, the conversion can look fully taxable on paper.
Old IRA Money Changes the Math
When you convert, the IRS treats every traditional, SEP, SIMPLE, and rollover IRA you own as one pool, and it won't let you convert only the after-tax dollars. This is called the pro-rata rule, and it's the reason step 2 comes before step 3.
Say you have $92,500 of pre-tax money sitting in a rollover IRA from a job you left years ago, and you add a $7,500 non-deductible contribution. The pool is now $100,000, and only 7.5% of it has already been taxed. Convert $7,500 and about $6,937 of it counts as taxable income that year. The strategy still works, but it stops being close to tax-free.
A common way around this is to move the pre-tax IRA money into a current employer's 401(k), if the plan accepts roll-ins, before you convert. That takes the balance out of the calculation. Whether that's worth doing depends on the plan and the rest of your picture, so it's a question for a planning conversation, not a rule of thumb.
What to Expect Each Year After
The backdoor Roth isn't a one-time move. The contribution limit resets every January, and many households make the contribution and the conversion an annual routine. The limit is per person, so a married couple can each do it. And if you're under 59½, each conversion has its own five-year clock before those dollars can be withdrawn without a penalty.
Most Mistakes Come From Two Skipped Steps
When a backdoor Roth goes wrong, it's rarely because the idea was complicated. It's usually an old rollover IRA nobody remembered at step 2, or a missing Form 8606 at step 6 that makes the same dollars look taxed twice.
Whether this is the next most important decision for your household or a detail for later depends on everything else in your plan. If you'd like to sort that out with us, schedule a Right Fit Call.
