I want to help my sister do a backdoor Roth IRA conversion to help start and fill up her Roth IRA for 2025. I’ve been contributing to my personal Roth since 2024 and was able to back fill 2023 due starting in Feb 2024. Similarly I want to do the same for my sister and back fill 2025 before she proceeds to fill 2026. My question is there any problem with doing a backdoor Roth IRA conversion for a 2025 Roth IRA while we are in 2026? Is it too late? Or is it allowed until tax day like the regular Roth IRA contribution limit?
Back door Roth IRA conversion question
byu/Kakashicopyninja9 ininvesting
Posted by Kakashicopyninja9
3 Comments
Tax day has no relationship to a conversion; only what year you can contribute to. ~~I need to review the rule, but I think the technicality of it is that it is not the tax day that is your deadline, but when you file your taxes. If you file your taxes before April 15, after that point you would have to make contributions only to the current year. I need to verify that though.~~
The backdoor part is being allowed to make the non-deductible contribution, so its deadline is no different than regular contribution.
The conversion can be done any time, years later if you want, but obviously it should be immediately.
To clear something up, there is no such thing as a backdoor Roth. It is a colloquial term of 2 separate transactions allowed in an IRA. 1) ANY ONE can make non-deductible IRA contributions and 2) you are allowed to convert any dollar amount of traditional IRA dollars. What is known as the ‘backdoor Roth’ is making non-deductible traditional IRA contributions and (as soon as possible) converting those dollars so that no taxes on the gains ever happen.
The IRS doesn’t recognize “i want to convert my 2025 IRA contributions for the 2025 tax year”. The don’t care. The conversion happens in the year that it happens. Here’s a simple example: you never made any 2025 contributions but will do so in 2026. And at the same time make your 2026 contribution. So if you’re under 50, contribute $14,500 ($7,000 for 2025 and $7,500 for 2026). And then convert all $14,500. The IRS doesn’t care about the year the contribution but only the year the conversion happened.
In short, this is all fine.