You're right. I trusted too hard on o3-Mini, that suggested that timing matters. o1 coincides with you, also by reading the form 8606 I coincide too. Thanks.
Extract from o1:
Taxes do apply if your IRA balance contains pre-tax money at year end. Because of the pro-rata rule, the percentage of after-tax vs. pre-tax in your IRA at year-end determines how much of the earlier conversion is taxable income.
For a typical “backdoor Roth” strategy to stay tax-free, you generally need to ensure you have zero pre-tax balances in all your traditional IRAs as of December 31 of that same year. Rolling a large 401(k) into your IRA mid-year can defeat the tax-free part of the backdoor Roth.
If your goal is to preserve the tax-free aspect of the backdoor Roth, many people try to:
Convert first, then keep the IRA empty of pre-tax dollars through Dec. 31.
Or use a qualified plan (like a 401(k) that accepts IRA roll-ins) to keep pre-tax amounts outside of any IRAs at year-end.
Once the pre-tax money sits in your IRA on December 31, it “contaminates” (or, more precisely, it factors into the pro-rata calculation for) that entire tax year’s conversions.
