The tax code explicitly requires that all IRAs of an individual be treated as a single IRA with respect to the pro-rata tax calculation because the lawmakers anticipated that individuals would otherwise artificially segregate nondeductible contributions in a separate account to sidestep the pro-rata requirement, something that they did not want to allow because it defeated the intent of the pro-rata calculation. At least the result is better than what happens when taking a nonperiodic distribution from a nonqualified annuity, which the law requires to come first from the taxable portion of the annuity.
