Backdoor Roth Pro-Rata Calculator 2026 β Multi-IRA Aggregation
Calculate the taxable portion of your Roth conversion under the pro-rata rule. Model Traditional, Rollover, SEP, and SIMPLE IRA aggregation. Compare with and without reverse rollover strategy.
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All traditional IRAs you own (pre-tax contributions + earnings) $
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Sum of non-deductible IRA contributions from Form 8606 $
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Pro-Rata Calculation
How the Pro-Rata Rule Works
The IRS treats ALL your Traditional IRAs as one pool when calculating the taxable portion of any conversion. You cannot "cherry pick" which dollars to convert β the pro-rata rule forces you to convert a proportionate mix of pre-tax and after-tax dollars.
Total IRA Balance = Traditional + Rollover + SEP + SIMPLE IRAs
Basis Ratio = After-Tax Basis / Total IRA Balance
Tax-Free Portion = Conversion Amount Γ Basis Ratio
Taxable Portion = Conversion Amount Γ (1 β Basis Ratio)
Tax Owed = Taxable Portion Γ Marginal Rate
With Reverse Rollover:
Roll Traditional/Rollover into 401(k) β Remaining IRA = Basis only
New Basis Ratio = 100% β Tax-Free Conversion = 100%
Basis Ratio = After-Tax Basis / Total IRA Balance
Tax-Free Portion = Conversion Amount Γ Basis Ratio
Taxable Portion = Conversion Amount Γ (1 β Basis Ratio)
Tax Owed = Taxable Portion Γ Marginal Rate
With Reverse Rollover:
Roll Traditional/Rollover into 401(k) β Remaining IRA = Basis only
New Basis Ratio = 100% β Tax-Free Conversion = 100%
Example β $200K total IRA, $7K basis, converting $7K, 32% rate:
Basis ratio: $7,000 / $200,000 = 3.5%
Tax-free: $7,000 Γ 3.5% = $245
Taxable: $7,000 Γ 96.5% = $6,755
Tax owed: $6,755 Γ 32% = $2,161
With reverse rollover (move $193K to 401k first): 0% taxable = $0 tax
Basis ratio: $7,000 / $200,000 = 3.5%
Tax-free: $7,000 Γ 3.5% = $245
Taxable: $7,000 Γ 96.5% = $6,755
Tax owed: $6,755 Γ 32% = $2,161
With reverse rollover (move $193K to 401k first): 0% taxable = $0 tax
Sources & References (click to expand)
- IRC Β§408(d)(2) β Pro-Rata Rule for IRA Distributions and Conversions
- IRC Β§72(e)(8) β Annuities and IRA Taxation (basis tracking)
- IRS Notice 2014-54 β After-Tax Amounts in Employer Plans (rollover allocation rules)
- IRS Publication 590-A β Contributions to Individual Retirement Arrangements (Form 8606, basis)
- IRS Form 8606 Instructions β Nondeductible IRAs (pro-rata calculation worksheet)
Extended
Reverse Rollover Strategy Calculator
Model rolling Traditional IRA into 401(k) to isolate basis. Multi-year planning table. Solo 401(k) alternative analysis.
Model the reverse rollover strategy β roll Traditional/Rollover IRA into 401(k) first, then do a clean backdoor Roth. See multi-year tax savings.
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Pre-tax balance eligible for reverse rollover $
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2026 limit: $7,000 / $8,000 age 50+ %
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Tax Savings β With vs Without Reverse Rollover
With Reverse Rollover (clean backdoor) Without Reverse Rollover (pro-rata)
Multi-Year Backdoor Roth Planning Table
| Year | Contribution | Tax (No RR) | Tax (With RR) | Annual Savings | Roth Balance (RR) | Cumulative Savings |
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Frequently Asked Questions
What is the pro-rata rule and why does it make backdoor Roth complicated?
The pro-rata rule (IRC Β§408(d)(2)) states that when you convert any Traditional IRA money to Roth, the taxable percentage is determined by the ratio of your after-tax (non-deductible) basis to your TOTAL IRA balance across ALL traditional IRAs. You cannot choose to convert only your non-deductible contributions. For example, if you have $94,000 in a Traditional IRA and make a $6,000 non-deductible contribution ($100,000 total), only 6% of any conversion is tax-free. Converting $6,000 = $360 tax-free + $5,640 taxable. This is the core problem with backdoor Roth for most people.
What is the "reverse rollover" strategy and how does it fix the pro-rata problem?
If your 401(k) plan allows rollovers in, you can roll your Traditional/Rollover IRA balance INTO the 401(k) before doing the backdoor Roth conversion. This removes the pre-tax balance from the IRA aggregation formula. After the rollover, you only have non-deductible basis left in your IRA, making the conversion 100% tax-free. Not all 401(k) plans accept IRA rollovers, and they may not accept after-tax basis amounts β so careful planning is required. SEP-IRAs can often be rolled into a 401(k) as well.
Which IRA accounts are aggregated for the pro-rata rule?
ALL non-Roth IRAs owned by you are aggregated: Traditional IRAs, Rollover IRAs (including old 401k rollovers), SEP-IRAs (Simplified Employee Pension), and SIMPLE IRAs (after the 2-year waiting period from the first contribution). Notably, 401(k), 403(b), and 457(b) accounts are NOT included in the aggregation β only IRAs. Roth IRAs are never included. This means a large Rollover IRA from a previous employer can sabotage an otherwise clean backdoor Roth strategy.
What is the contribution limit for backdoor Roth in 2026?
The 2026 IRA contribution limit is $7,000 per person ($8,000 if age 50+). Backdoor Roth uses this same limit. The process: (1) Make a non-deductible Traditional IRA contribution ($7,000); (2) Convert it to Roth IRA. High earners who cannot deduct Traditional IRA contributions and cannot contribute directly to Roth IRA (2026 phase-out: $146,000-$161,000 single, $230,000-$240,000 MFJ) use this strategy. Married couples can each do backdoor Roth for $14,000 total annual contribution.
What is a Solo 401(k) alternative to the reverse rollover?
If you are self-employed or have self-employment income (even a small side hustle), you can establish a Solo 401(k) plan. A Solo 401(k) can accept rollovers from Traditional/Rollover IRAs, effectively clearing out your IRA balance and eliminating the pro-rata problem. A Solo 401(k) also allows higher contribution limits: up to $69,000 in 2026 ($76,500 if 50+) as both employee and employer. Some Solo 401(k) plans even allow a Roth option within the plan, making post-tax contributions directly without the backdoor conversion step.