ChristinaS
Expert Alumni

After you file

A conversion occurs in the calendar year that it literally happened. While you can make a 2015 tax year IRA contribution in 2016 for 2015, the Roth conversion cannot be retroactively applied to 2015.

That being said, with a backdoor Roth, you keep the Traditional IRA contribution nondeductible. So, all else aside, the nondeductible contribution establishes "basis" on Form 8606 and keeps the conversion tax-free**.

If done correctly, the conversion to a Roth isn't taxable anyway. You would have $11,000 in nondeductible Traditional contributions. That would offset the 1099-R for the conversion, with only the earnings being taxable. If you did the conversion close to the contribution, the earnings would be small or nothing at all.

  • Did you make the $11,000 contribution in 1/2016 for 2016 or for 2015?
  • Did you have a deduction for the Traditional IRA contributions? (If you make enough money that you need to do a backdoor, it wouldn't make sense for you to have had a deduction)
  • Do you have the 1099-R for the conversion in 2016? How much is on that? Close to $11,000?

** A conversion is tax free when you don't have anything in a Traditional IRA by the end of the year (in this case, 12/31/2016)


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