I originally had traditional and nonqualified IRA which I withdrew both funds by 6/2024 since they cannot be rolled over to other plans. Can I still do backdoor Roth

Forum|Forum|1 year ago
January 6, 2025
1 reply
0 views

of $7000 for 2024 (catch up backdoor) and avoid pro rata rule since all my IRA accounts are "zero" by 12/31/24? Does the fund need to be "zero" by 12/31/24 or 12/31/23 in order for me to do backdoor Roth for 2024? If I can do backdoor Roth for 2024, for 2024 tax form 8606, # 2 (enter total basis in traditional IRAs), do I put amount I had in traditional IRA for 12/31/23 or "zero" because all IRAs are empty by 12/31/24? If we are filing married and jointly, can both my husband and I both do backdoor Roth for $7000 each? Or total for both of us needs to be $7000? Any help is appreciated!!!

DaveF1006

Yes, the fund needs to be "Zero" by 12/31/2024 to avoid the "pro rata" rule. Both of you are eligible to do a backdoor Roth.

Form 8606 instructions state that if this is the first year you are required to file an 8606, put "zero" on that line. However you may need to enter an amount if any of the following conditions exist.

You had a return of excess traditional IRA contributions .
Incident to divorce, you transferred or received part or all of a traditional, traditional SEP, or traditional SIMPLE IRA
You rolled over any nontaxable portion of your qualified retirement plan to a traditional, traditional SEP, or traditional SIMPLE IRA that wasn’t previously reported on Form 8606, line 2. Include the nontaxable portion on line 2.

If any of these conditions exist, use the total basis chart to determine what to put on line 2. This chart is also listed on page 9 of the instructions. Click on the instructions link for more details.

**Say "Thanks" by clicking the thumb icon in a post**Mark the post that answers your question by clicking on "Mark as Best Answer"

candytlin3Author

Got it, thank you so much!!!! I have been asking numbers of CPAs and none of them could offer me any insights. Your response saves my frustration!!! Hope you have an awesome year!!!