So I usually make between $130-$150k a year but got promoted mid-year last year and surpassed the income limit for 2025 Roth contributions. I put $7,000 into my Roth IRA in early 2025 when I thought I wouldn’t be above the mark.
How do I go about backdooring in this instance? Convert to Trad IRA and then put it back in my Roth?
I maxed out my 401k at $23,500 as well. Assuming I move it from my Roth to a read IRA, would I get dinged for exceeding the $23,500 retirement contributions since retirement contributions are pro-rata?
Backdoor Roth Help – Exceeded Income Limit
byu/gilbertmcgee17 ininvesting
Posted by gilbertmcgee17
4 Comments
I had a similar issue. It was easier to just pull the money out of the rIRA and put it into tIRA. I didn’t mess with backdoor because of pre-tax/post-tax money intermingled in tIRA && my income was already high, so the backdoor would have costed me even more in taxes.
You need to talk to your IRA provider and get the contribution recharacterized as a Traditional IRA contribution and then convert it to Roth. Do not withdraw it yourself.
Your employer 401k has absolutely nothing to do with your IRA conversions or pro rata. If you have pre-tax (deductible) traditional IRA contributions (not in your 401k), you need to tread carefully because of the pro rata issues.
If no change in law, it is always easier to contribute to tIRA then convert to rIRA then in next year you can decide whether the tIRA is tax deductible or not depending on your income
One element that I think hasn’t been mentioned yet: I’m pretty sure that the backdoor Roth conversion needs to be done within the calendar year that you are filing those taxes for. So it is now too late to do the backdoor Roth for 2025.
Lots of other good advice here in the comments.
Probably best to call your brokerage or CPA and get legit advice.