I think I am almost there.
Here is my plan:
- Since IRA#1 (the one that I want to zero out) has a $44,000 balance right now, I will request the pre-tax portion = $44,000 - $ 13,924 = $30,076 of it to be moved into my 401K.
- That leaves me with the post-tax balance of $44,000 - $30, 076 = $13,924, which I plan to roll-over into IRA#2 (purely for the sake of account consolidation), which already has $6000 in post-tax funds.
- At this point, IRA#1 will have a balance of $0.
- I will then do a backdoor Roth conversion of the entire $19, 924 in IRA#2. IRA#2 will then have a balance of $0 as well
I think this resets everything and makes my backdoor Roth conversions in the future indeed 100% tax-free. To confirm that, I filled a mock 2022 8606 here. I would really appreciate it if you could review it and confirm that everything looks ok.
Also: as I understand it, my IRA balance has to be $0 as of Dec 31st of the conversion year. So I could technically execute the above steps later (but well before Dec 31st of course) since all this is only relevant when I do my taxes again in 2023?
