How to Do a Backdoor Roth IRA Married Filing Jointly

The backdoor Roth IRA is a strategy for contributing to a Roth IRA even if your income exceeds the direct contribution limits. For high-income married couples filing a joint tax return, this method provides a path to tax-free growth and withdrawals in retirement. The process involves making a non-deductible contribution to a traditional IRA and subsequently converting those funds to a Roth IRA.

For 2025, the ability for a married couple filing jointly to contribute directly to a Roth IRA phases out with a Modified Adjusted Gross Income (MAGI) between $236,000 and $246,000. If a couple’s joint MAGI is above $246,000, they are ineligible to make a direct contribution. The backdoor approach bypasses these limitations because there are no income restrictions on making non-deductible traditional IRA contributions or on converting a traditional IRA to a Roth IRA.

Key Considerations for Married Couples

While a couple may file a joint tax return, Individual Retirement Arrangement (IRA) rules apply to each spouse individually. Contribution limits, conversion regulations, and tax implications are assessed on a person-by-person basis. Each spouse has their own contribution limit and set of IRAs, and the activity in one spouse’s accounts does not directly impact the other’s.

A central concept governing the taxation of a Roth conversion is the pro-rata rule. This rule is triggered if an individual has pre-tax funds in any traditional, SEP, or SIMPLE IRAs at the end of the year the conversion occurs. The IRS aggregates all of an individual’s non-Roth IRAs to determine the taxability of the conversion, treating them as one large IRA. The conversion is then considered a proportional mix of pre-tax and after-tax dollars from that total.

For example, a spouse has an existing traditional IRA with a $93,000 pre-tax balance and makes a new $7,000 non-deductible contribution. The total value of their traditional IRAs is $100,000, with the after-tax portion representing 7% of the balance. If this spouse converts the $7,000, the IRS considers 93% of that conversion ($6,510) to be from pre-tax funds, making it taxable income.

Spousal IRA rules allow a couple to contribute to a traditional IRA for a spouse with little or no earned income, provided they file a joint return and the earning spouse has enough compensation to cover both contributions. This allows both partners to use the backdoor Roth strategy. To properly apply the pro-rata rule, each spouse must know the total value of all their existing traditional, SEP, and SIMPLE IRA accounts as of December 31st of the conversion year.

The Contribution and Conversion Process

The first step is for each spouse to fund a traditional IRA with a non-deductible contribution. For 2025, the annual contribution limit is $7,000 per person, or $8,000 for those age 50 and older. It is often advisable for each spouse to open a new, empty traditional IRA for this purpose to simplify record-keeping.

Once the contributions are made, each spouse converts the funds from their traditional IRA to their Roth IRA. This is a direct movement of assets initiated through the financial institution holding the accounts. While the IRS does not mandate a specific waiting period, waiting a few business days for the contribution to settle can minimize any investment gains in the traditional IRA, as such gains would be taxable upon conversion.

To avoid the tax consequences of the pro-rata rule, an individual can eliminate pre-tax balances from all traditional, SEP, and SIMPLE IRAs before the end of the conversion year. One method is to roll over these pre-tax funds into a current employer’s 401(k) or similar workplace retirement plan, if the plan permits incoming rollovers from IRAs.

By transferring all pre-tax IRA money into a 401(k), an individual’s total pre-tax IRA balance becomes zero. Since 401(k) balances are not included in the pro-rata calculation, the subsequent Roth conversion will consist entirely of the after-tax, non-deductible contribution, making it a non-taxable event. This rollover must be completed by December 31st of the year the Roth conversion is performed.

Tax Reporting for Your Joint Return

Documenting the backdoor Roth IRA process on a joint tax return is handled through IRS Form 8606, Nondeductible IRAs. Each spouse who completed a non-deductible contribution or a Roth conversion must file their own separate Form 8606. Both individual forms are then attached to the single Form 1040 when the couple files their joint return.

Part I of the form is used to report the non-deductible contributions made to a traditional IRA for the tax year. This section establishes the total after-tax basis in the account before any distributions or conversions.

Part II of Form 8606 is where the Roth conversion is reported and its taxability is calculated. This section formally applies the pro-rata rule using the account values as of December 31 of the tax year. The form calculates what portion of the conversion is from pre-tax funds (taxable) and what portion is from the after-tax contribution (non-taxable).

The taxable amount of the conversion, if any, is transferred from Form 8606 to Form 1040. If the backdoor Roth IRA was executed without any pre-tax IRA balances, the taxable amount on Form 8606 would be zero. This results in no additional income being reported on Form 1040 from the conversion.