Backdoor Roth IRA Taxation
In 2026, Maria, age 52, is single and has MAGI of $210,000, making her ineligible to contribute directly to a Roth IRA. She makes a $7,500 nondeductible contribution to a traditional IRA and immediately converts the entire balance to a Roth IRA.
At the time of conversion, Maria also owns a rollover traditional IRA from a former employer with a value of $67,500, all of which consists of pre-tax dollars. Maria has no other IRAs.
What portion of Maria’s Roth conversion will be taxable in 2026?
- $0
- $6,750
- $7,500
- $67,500
