Backdoor Roth Pro-Rata Calculator: Taxable Part of Your Conversion

A “backdoor” Roth is a nondeductible contribution to a traditional IRA followed by a conversion to a Roth IRA. If the contribution is the only money in your traditional IRAs, the conversion is almost all basis, so almost nothing is taxed. If you also hold pre-tax money in a traditional, SEP or SIMPLE IRA, the law does not let you pick the after-tax dollars: for working out tax, all your IRAs are one contract, everything you take out in a year is one distribution, and the value is taken at the close of the year (26 U.S.C. 408(d)(2)). The tax-free share of whatever comes out, converted or not, is your basis divided by the year-end value plus what came out.

With a $7,500 contribution converted and $50,000 of pre-tax money left in a rollover IRA, the basis is $7,500 out of $57,500, or 13.0%. Only $978 of the conversion is tax-free and $6,522 is added to your income. The rest of the basis ($6,522) does not disappear: it stays in the IRAs and goes on next year's Form 8606.

No. Form 8606 line 6 asks for the value of all your traditional, SEP and SIMPLE IRAs on December 31, not on the day you convert, and line 9 adds the amount converted back. The timing of the conversion within the year does not change the ratio; what you hold on December 31 does. That is also why the date matters for the move into a 401(k) described below: it has to be done before the year ends.

Counted: traditional IRAs, SEP IRAs and SIMPLE IRAs, at every provider, plus a rollover that is still in transit on December 31 (the Form 8606 instructions for line 6). Not counted: a 401(k), 403(b) or 457(b) account, any Roth IRA, and an inherited IRA, whose basis goes on a separate Form 8606. An employer-plan balance is not on Form 8606 at all, which is why moving pre-tax IRA money into a plan removes it from the ratio. Married couples do not combine their IRAs: each spouse files a Form 8606 for their own IRAs, so run the calculator once for each.

Publication 590-A says a traditional IRA can be rolled into a qualified plan (401(k), 403(b), governmental 457(b), the Thrift Savings Plan) and that the part you can roll over is the part that would otherwise be taxable. A special rule treats the move as only taxable dollars as long as what you leave in your IRAs is at least your basis (the limit comes from 26 U.S.C. 408(d)(3)(A)(ii), which caps the rollover to a plan at the part includible in gross income). Plans may, but do not have to, accept such rollovers. A rollover to a plan is not a line 7 distribution, and the money is no longer in the IRAs on December 31, so line 6 shrinks. In the example, moving all $50,000 leaves only the basis in the IRAs and the taxable part of the conversion falls from $6,522 to $0.

The calculator limits the move to the pre-tax part (what the IRAs held less your basis) and says so when you ask for more. It cannot know whether your plan accepts the money, what the plan costs or limits, or whether you want that money inside a plan; those are your decisions.

Line 1 includes contributions made for the year up to April 15 of the next year, but line 4 takes out what you actually contributed from January 1 to April 15, because, say the instructions, those contributions are not included in figuring the nontaxable part of that year's distributions. They still count as basis afterwards. In the calculator, a $7,500 contribution made in January for the previous year gives a ratio of 0.000 for the previous year, so a $7,500 conversion that year would be fully taxable ($7,500), and the $7,500 goes on line 2 the year after. The Form 8606 instructions have this rule; check which year each contribution is for before you enter it.

Worksheet 1-1 in Publication 590-B is the version used to figure whether an IRA deduction is reduced; it counts every contribution for the year in its numerator. Its illustrated example (Rose Green: $300 of basis, a $2,000 contribution, $20,000 left, $5,000 converted) gives a ratio of 0.092, $460 never taxed and $4,540 taxable, and the calculator reproduces those numbers when given the same amounts as lines 1, 2, 6 and 8. For a nondeductible contribution you fill in Form 8606 itself, which is what the lines in the table above follow.

The basis that is not used up stays in your traditional IRAs and is carried on line 14, which becomes next year's line 2. You file Form 8606 for every year you made a nondeductible contribution or took a distribution from an IRA that has basis. Publication 590-A says a $50 penalty applies if you do not file a required Form 8606 (unless there is reasonable cause), a $100 penalty applies for each overstatement of nondeductible contributions, and that without the form your contributions are treated as deductible and the distributions taxed.

It follows the 2025 Form 8606 (the 2026 form is not out; the lines have not changed in years, but check yours). It does not model inherited IRAs, disaster distributions and repayments, a divorce transfer, recharacterizations, returned contributions, the 10% additional tax on a withdrawal that is not converted (the early withdrawal calculator does that), state tax, or what the extra income does to credits, Medicare premiums ( IRMAA) or Social Security taxation. It does not decide whether a backdoor Roth suits you. The Roth contribution limit and its income range are in the IRA limit calculator; what a Roth withdrawal costs later is in the Roth IRA withdrawal calculator.