Thank you for the inputs. Here is my exact question. I have a traditional IRA account which has been funded for few years now. I have cash and equity assets that have appreciated over the period. Year 2022 and 2023, I did non-deductible contributions of $7000 each. Filed an ammendment this year to add form 8606 (not sure why it was not present in previous TT filiings). From this year onwards I want to do Roth IRA contribution and the way I have read is to contribute to Traditional IRA then do a backdoor conversion to Roth (have high MAGI) as you stated earlier. Now if, I want to convert the 22, 23 contributions and 24 & 25 ones I will do this year with no tax how can I do it? I see some articles that suggest to keep the prev. contributions and new contributions in the IRA account and move all deductible cash/assets to 401k account. It states 401k account is not looked at when pro-rata tax calculation is computed. So to avoid getting taxed based on the pro-rata tax calcuation these will be the steps to follow:
1. keep prev. years non-deductible contributions in account.
2. add new contributions e.g. 2024 and 2025 to the IRA account.
3. move/transfer other assets/cash to 401K account.
4. transfer 100% of IRA account to Roth using backdoor conversion.
5. since all 100% value is non-deductible contribution, it will get transferred 100% tax free to Roth account.
6. later years keep doing backdoor conversion.
Please let me know if my understanding is right. Thank you.
