Backdoor Roth for LAST YEAR (or 2024 and 2023 at same time!)

[@ardalan8103]

This is LITERALLY what I was hoping to find online! I exactly did this last year and I was so confused about reporting it in my taxes. THANK YOU SO SO MUCH!

[@mikifu5369]

This is what I have been searching online for weeks!! Thank you so much for your help!

[@chancock5107]

This is exactly what I needed! I was struggling to find this explanation anywhere else. Thank you so much!

[@WillPeterson]

Very happy it was helpful!

[@qingguo3916]

This is so helpful. Thank you so much! I couldn’t get a better explanation online!

[@thatguy9051]

Brilliant, and explained so the general public (Who don't understand taxes) can understand. If you want this to blow up in utube, list max contributions based upon income and plot a table of compounded interest----additionally, the fact that the Roth is not taxed upon withdrawal and doesnt have to be taken out at age 72---is a gold mine.

[@Simonjose7258]

These videos are so helpful.

[@michd6452]

Thanks so much for your video and that's exactly what I was looking for. I did the Backdoor Roth for both year 2022 and year 2023 in Jan 2023. and I filed form-8606 of Year 2022 for the 6k (line1 and 3) of TIRA. Now I have a question about the Form-8606 of year 2023. Should I input line1-6500, line2-6000 and line3 as 12500 ? thanks a lot for your confirmation.

[@felixtran1509]

Thanks for the great video as usual Will! Could you make a video explaining the new changes to backdoor and megabackdoor Roths from the Build Back Better bill?

[@CaKiteboarding]

great explanation, i have watched this few times as I am doing exactly the same thing right now. You sound and look like an actor or a standup comedian but can't seem to remember his name. do you know who I am talking about? cheers

[@berickson45]

Hello Will, thank you for this video! It was very helpful. I have a quick question. I forgot to contribute and convert in 2023 because I was on vacation over new years and didn’t get a chance to do this during the 2023 year. On January 10 of 2024, I contributed $6,500 to a traditional IRA for the 2023 tax year, and the balance is still in there, but is now at $6,500.32. My question is, can I still back door convert this in 2024 for the 2023 tax year?

[@triotinkering862]

Yes. You can convert the entire tIRA balance in 2024 and pay tax on the 32 cents. As the video explains, the non-deductible tIRA contribution will be a part of your 2023 return (form 8606) and the conversion will be part of your 2023 return (form 8606).

[@pranayshirolkar]

Thank you for clarifying!

[@1wanph]

Is there an annual backdoor roth conversion limit by the IRS (similar to limits for direct contributions to roth and ira accts)?

[@glenng9111WoodbridgeSwing]

Awesome video!

[@CaKiteboarding]

Fantastic video. I have few questions all relating to Roth IRA and stuff, can I ask them here, or can I email them? do you have a service? I am willing to pay for a consultation. Are you a CPA? Thanks again.

[@WillPeterson]

Sorry for the delay. I'm not a cpa, but if I can give you some guidance I'm happy to. Email me at [e-mail]

[@carlrobinson3835]

Appreciate the info. I rolled over a pension from my previous employer back in 2021 of 80k to traditional ira. I never contributed to the ira just rolled over and started investing it. I do not have any other iras or have contributed to any iras. I just have a roth that i contribute the max to every year. Would it trigger the pro rata rule if i started to chunk this year into my roth. Hopefully i explained this correctly.

[@QiuWong]

Hey Will, awesome video! Quick question: In this example you made, usually Fidelity issues a 1099-R form that mails to you around Jan 2023, with an amount of $10k, which is the sum of the contribution/conversion of 2021 and 2022. Since this 1099-R form arrives in Jan 2023, I could have missed reporting form 8606 for 2021 during 2022 tax preparation season. Imagine I realized that one year later, during the 2023 tax preparation season, with the help of the arrival of the Fidelity 1099-R form with 10k on it, how could I fix this error of missing Form 8606 for 2021 next year? That's exactly what happened to me right now at Feb 2022: I did the backdoor for 2020 and 2021 last year but forgot to submit 8606 for 2020 in the last tax preparation season.. Thanks for the help!

[@boudicca7070]

You can always do an amendment on your filing. If you do not amend, the IRS will charge you until corrections are made.

[@prodbydjsmalls]

Will, let's say you don't have the 6000 in lump sum so you plan to contribute monthly, can you make several conversions i.e., once per month (500 per month). Then file just one form 8606 at the end of the tax year?

[@WillPeterson]

Yes, no issue with that

[@nickhabre2824]

Good video as always man. Have you been keeping up with congress considering banning some of backdoor and super mega backdoor conversions

[@WillPeterson]

I have! If that goes through I'll need to take down most of my best performing KZbin videos! 🤣

[@myhouse-yourhouse]

@@WillPeterson would be sad, they were good knowledge

[@odkhuu]

Hi Will . I have zero dollars in my traditional IRA now. I just opened it now. Should I deposit 6.5k for 2023 and then a separate deposit for 7k for 2024 on the same day ? And then do the conversion on the same day ? I don’t want to pay any taxes on gains for 2023

[@supersonicgamer1551]

Hi, I just ran into this very informative video. My question is: I have already filed my taxes for 2022. Does this mean that I cannot contribute to 2022 IRA anymore since I have already filed my 2022 taxes? Any help with this questions is greatly appreciated.

[@idsullymichaels]

those last 2 questions... what if you have leftover $ in the traditional IRA? what if you have gains (or losses?)?... I'll be watching the next video. We have a traditional IRA with over $180k. I moved $27k into a Roth. Converted stock positions that were down. trying to figure all the details, but summation seems to be that I increased our taxable earnings/income for 2023 by $27k... I'd read something about us contributing $7k (the max) to the Roth and that might somehow open the 'backdoor' but think it was a misinterpretation. My guess is "no escaping the tax man" - paying taxes on the $27k. My main goal is doing the conversion slowly to not throw us into a new income bracket.

[@WillPeterson]

It all depends on the mix of "not yet taxed" versus "already-taxed" (AKA "non-deductable") money in your traditional IRA. MOST money in a traditionaal IRA is usually "already taxed". That's because most people get their money in the IRA through direct IRA contributions for which they take a deduction (the whole point of an IRA!) that makes them effectively not-yet-taxed. Likewise, if you had a traditional 401k at work, and you rolled that money into your tIRA, it would also likely be "not-yet-taxed". Any earnings your money made in there are also not-yet-taxed If all the money in your tIRA was not-yet-taxed, then yes, the full value of your conversion to Roth counts as taxable income. The ONLY reason part of your conversion might not be taxable is if you had "already-taxed" money in your tIRA. That usually only happens if you made "non-deductible" contributions to your tIRA because you were over the income limit to take the deduction. This is common if you are doing the "backdoor Roth". definitly check out my other videos on that, as well as the "pro-rata" rule, but it sounds like none of that will apply to you.

[@ntheq3982]

Isn't there a problem with doing backdoor contribution if you have a large traditional IRA? Is there the same problem doing a mega backdoor in a 401k plan?

[@WillPeterson]

Yes, I actually made a video about the "pro rata" rule. Luckily there is no such concern with the mega backdoor

[@dsmith4140]

Question: i’ve had a Roth IRA open for over five years. If I do a mega backdoor Roth, with the after tax and pay the tax on the earnings of the after-tax from my 401(k) to the Roth IRA that has been open For over five years, do I have to wait to withdraw money from the Roth IRA. Another words does the clock start every time you do a mega Back door Roth conversion from your 401(k) after tax money. I am over 60 years old.

[@domenickelly9297]

i don't know how a backdoor roth ira contribution works

[@kylemiller3185]

Thanks for you help, Will. This is great info! So to be 100%... I can do a total of $12,000 converted from tIRA to Roth IRA in 2022 ($6k transferred from 2021 tIRA contribution + $6k transferred from 2022 tIRA contribution)? Meaning for 2021 tax year I declare $6k contribution to tIRA and for 2022 tax year I declare 2022 contribution to tIRA and the 12k conversion to Roth IRA? appreciate it

[@lee08c]

In October 2021 (filed extension) I moved 2020 IRA money I had inappropriately put into a Roth IRA into an empty traditional IRA before the deadline. Then I backdoored it on Dec 2021. This is 2020 IRA money, not 2021 or 2022. What do I do now with form 8606? Do I have to amend last years taxes?

[@ajitaraut5504]

If I contribute to traditional IRA before April 18th 2023 for tax year 2022. Can I do the conversion later anytime in 2023? Asking because I am not sure if I have enough time to open a traditional account and contribute and do backdoor before tax filing deadline.

[@WillPeterson]

Yes!

[@sblack1016]

Hi Will, what if I only made last year's contribution in the new year (contribution for 2022 made in 2023), what sections of 8606 would I need to fill out?

[@richardjohnson7973]

Hi Will. Just discovered your channel through this video. Thanks! The visual was really helpful. I wonder if you know what to do if someone filed their tax return early (let’s say in March) and then realized they wanted to do what your saying in early April (before filing deadline). So they make the “prior year” contribution and conversion, but the prior year return was already submitted. Do they have to do an amended prior year return?

[@WillPeterson]

I'm not 100% sure of this, but I believe form 8606 can be filed (via snail mail) independent from that years tax return. So if the original tax return did not include form 8606 at all, I believe you could follow this strategy, and mail in form 8606 for the year in question after the original tax return is filed. This all hinges on the fact that no other lines on the original tax return change, which I believe would be the case.

[@joehfwefhweofhwepe]

Will. awesome videos, just found you and subscribed, really good. One question. I filed 2020 already can I do a 2020 deposit then rollover and a 2021? Not asking tax advice just knowledge

[@WillPeterson]

I'm glad you find them helpful! Unfortunately not, May 17 2021 was the deadline for 2020 contributions

[@joehfwefhweofhwepe]

@@WillPeterson Dang. Thanks. It was just strange given the timing of the release :) I am trying to get my company to allow after tax contributions to the 401 options we have. Luckily I am the owner so getting provider to do same. Not clear how to do the mega conversion still but trying my best.

[@DrDudeUSA]

Hi Will, not sure if you could guide me, I did back door conversion in Feb for 2021 -contributed to traditional IRA $6000 and immediately moved that to Roth IRA. I did not receive any 1099-R from Vanguard. My taxes are already submitted without 8606. What should I do now ? I am also planning to contribute in June for 2022. Just FYI. I would appreciate your help.

[@WillPeterson]

No problem, this is the situation covered in the later part of the video. The contribution would go on your 2021 taxes, form 8606, and the conversion will go on your 2022 taxes (you'll get the 1099-R next February). Since you already filed your 2021 taxes without a form 8606, you'll have to fill out and mail the form for 2021 separately, accounting for the contribution only (not the conversion, which is for 2022). Here's a reddit post discussing mailing form 8606 separately. www.reddit.com/r/tax/comments/mv44ob/can_i_file_form_8606_after_filing_my_returns_form/ Good luck!

[@benklee12]

Just to confirm, if I am filing form 8606 for 2023 taxes on 3/1/24, do I put $0 for the conversion to roth IRA?

[@WillPeterson]

Yes, the 2023 form is only asking about conversions that actually occurred in 2023

[@boudicca7070]

Why not skip the Traditional IRA contribution and just put your money into Roth IRA. I guess IRS like to complicate things. They don’t do things that make sense 🤣