How to Do a Backdoor Roth IRA (Step-by-Step 2026 Guide)

What Is a Backdoor Roth IRA?

If your household income exceeds the 2026 phase-out limit ($168,000 for singles, $252,000 for married couples), the IRS prohibits direct Roth contributions.

However, tax code section 408A allows any taxpayer—regardless of income—to make a non-deductible contribution to a Traditional IRA, and subsequently convert that Traditional IRA to a Roth IRA.

The 4-Step Process

1. Open Accounts: Ensure you have both a Traditional IRA and a Roth IRA open at a brokerage such as Vanguard, Fidelity, or Charles Schwab.
2. Contribute Non-Deductible Dollars: Deposit the maximum ($7,500 for 2026) into your Traditional IRA. Do not take a tax deduction on your tax return for this contribution.
3. Wait for Settlement: Let the cash deposit settle (usually 1 to 3 business days). Do not invest the cash into stocks yet to prevent earning taxable interest.
4. Execute Roth Conversion: Select ‘Convert to Roth IRA’ on your brokerage dashboard. Transfer 100% of the funds into your Roth IRA.
5. File IRS Form 8606: Report the non-deductible contribution and conversion on IRS Form 8606 with your annual tax return.