Backdoor Roth IRA
A backdoor Roth IRA combines a nondeductible traditional IRA contribution with a Roth conversion and requires careful pro-rata tax reporting.
Personal-finance terms for IRA rollovers, transfers, Roth conversions, rollover IRAs, and the tax consequences of moving retirement assets.
IRA Rollovers, Transfers, and Conversions covers how U.S. retirement assets move between IRAs and employer plans. Start by identifying the source account, destination account, and movement method; those facts determine whether the transaction is a transfer, direct rollover, 60-day rollover, or Roth conversion.
Use Rollover for the transaction, Transfer vs. Rollover for movement mechanics, and Rollover IRA for the receiving account. Roth conversions and backdoor Roth transactions are separate because moving pre-tax value into a Roth account can create current taxable income.
| Topic or term | Best use |
|---|---|
| Backdoor Roth IRA | Nondeductible traditional IRA contribution followed by a Roth conversion, with pro-rata tax reporting when other IRAs exist. |
| Rollover | Movement of an eligible retirement distribution into another plan or IRA, either directly or through a 60-day rollover. |
| Rollover IRA | An IRA established to receive assets from an employer retirement plan. |
| Roth Conversion | Movement from a pre-tax retirement account into a Roth IRA, generally creating taxable income for untaxed amounts converted. |
| Traditional IRA vs. Roth IRA | Comparison of deductions, direct-contribution eligibility, future withdrawal tax, and required distributions. |
| Transfer vs. Rollover | Distinguishes an IRA trustee-to-trustee transfer from direct and participant-paid rollovers. |
An employee leaving a job asks the old 401(k) administrator to send an eligible distribution directly to a traditional IRA custodian. That is a direct rollover. If the check were paid to the employee instead, the 60-day deadline and mandatory withholding rules for employer-plan distributions could become relevant.
Use official sources for current rules, forms, and eligible transactions. This page avoids hard-coding figures that can change.
IRA Rollovers, Transfers, and Conversions is for financial education and vocabulary building. It is not personalized financial, investment, tax, legal, insurance, retirement, or benefits advice. For decisions with legal, tax, insurance, or investment consequences, confirm the current rule and consider a qualified professional who can review the specific facts.
Choose a subsection first. Deeper term pages live inside each subsection, which keeps large topic hubs readable.
A backdoor Roth IRA combines a nondeductible traditional IRA contribution with a Roth conversion and requires careful pro-rata tax reporting.
A retirement rollover moves an eligible plan or IRA distribution into another retirement account while preserving eligible tax-deferred treatment.
A rollover IRA receives eligible assets from a former employer plan and generally follows traditional IRA tax, investment, and withdrawal rules.
A Roth conversion moves traditional retirement assets into a Roth IRA, generally making untaxed amounts taxable in the conversion year.
Traditional IRA vs. Roth IRA compares deductions, contribution eligibility, withdrawal taxes, required distributions, and tax-timing trade-offs.
Transfer vs. rollover explains how IRA transfers, direct plan rollovers, and 60-day rollovers differ in handling, withholding, and deadlines.