If your modified adjusted gross income is above $161,000 single or $240,000 married filing jointly in 2026, you cannot contribute directly to a Roth IRA. The income limit is hard. The IRS phases you out as you approach those numbers and locks you out completely past them. Most high earners stop there and assume Roth space is closed to them. It is not. The backdoor Roth has been a documented and legal workaround since 2010, and Congress confirmed it explicitly in three separate pieces of tax legislation since 2017.
The mechanic is simple in plain English. You contribute to a traditional IRA with after tax money. Then you convert that traditional IRA balance to a Roth IRA. There is no income limit on either step. The result is the same as if you had contributed directly to the Roth, which is exactly what Congress intended when they removed the conversion income limit in 2010 without removing the direct contribution income limit.
Step one is opening a traditional IRA at a brokerage if you do not already have one. Fidelity, Schwab, and Vanguard all offer them with no fees and no minimums. Open the account. Do not transfer anything in from an old 401k. That last point is the single most important detail in this entire process. Read the next two paragraphs twice.
The pro rata rule is the one trap that makes the backdoor Roth complicated. The IRS treats all of your traditional IRAs as one bucket for tax purposes when you do a conversion. If you have $50,000 of pretax money sitting in a traditional IRA from a rollover, and you contribute $7,000 of after tax money and try to convert the $7,000, the IRS will say only a fraction of that $7,000 was after tax. The rest is taxable, calculated at the ratio of after tax to total IRA balance. You end up paying tax on most of your conversion.
The fix is to either roll your existing traditional IRA balance into your current employer 401k before you start, which most plans allow, or to leave the pretax IRA money alone and accept the tax hit. Most people roll it into the 401k. Call your 401k plan administrator and ask if they accept a rollover from an outside IRA. Almost all major plans do. Once that money is in the 401k, your traditional IRA balance is zero, and the pro rata calculation no longer hits you.
Step two, after your traditional IRA is empty, is the contribution. Make a $7,000 nondeductible contribution to the traditional IRA. The 2026 limit is $7,000 for under 50 and $8,000 for 50 and over. Mark it as a nondeductible contribution on the brokerage form. Do not invest the money. Leave it as cash for a few business days while it settles.
Step three is the conversion. Inside the brokerage, request a Roth conversion of the entire traditional IRA balance. Convert the full amount. There should be no growth between the contribution and the conversion if you did this within a week. If there is a few dollars of interest, that small amount is taxable, but it is usually under five dollars and not worth optimizing.
Step four is filing the right form. You will get a 1099-R for the conversion and a 5498 for the contribution. Your tax preparer needs to file Form 8606 with your return to track the basis. Without Form 8606 the IRS has no record that you contributed after tax money, and they may try to tax the entire conversion. If you file your own taxes, do not use the basic free version. Either upgrade to a version that supports Form 8606 or pay a CPA $300 to handle it the first year.
The whole process takes about thirty minutes once a year and adds $7,000 a year of tax free retirement growth. Over thirty years at a 7 percent return, $7,000 a year compounds to about $740,000. That is a meaningful amount of money to have in a tax free bucket alongside whatever your 401k and brokerage are doing.
A few extra notes for couples. Each spouse can do their own backdoor Roth if both are high earners. That doubles the annual contribution to $14,000. The accounts have to be separate IRAs in each spouse's name. There is no joint IRA in the tax code.
If your employer 401k offers a mega backdoor Roth feature, which means after tax contributions plus in plan Roth conversions, that opens up significantly more room. The 2026 total 401k contribution limit including employer match and after tax is $70,000. The space between your employee contribution, your match, and that ceiling is mega backdoor space. Most plans do not offer this feature. Ask HR or read your plan summary document. If yours does, the mega backdoor moves more money than the regular backdoor by a factor of five.
The backdoor Roth is one of the few unambiguous tax wins available to high earners. It is legal. It is cheap. It takes thirty minutes. There is no reason to skip it.
