Backdoor Roth Contribution for 2022 in 2023 Confusion
Posted: Tue Jan 24, 2023 11:58 am
Hi all -- Long time lurker and first time posting for advice in this forum!
I've been doing backdoor Roth IRA contributions for many years on my account. We never did it on DW's account because she had a bunch of rollover money from an old 401(k) mixed with non-deductible contributions back when she was making more and before Backdoor Roths were allowed, and I never wanted to sort through it (kind of a mistake).
Last year I finally sorted out her non-deductible basis from old tax returns and memory, and rolled over the pre-tax into a non-prototype Solo 401(k) (DW has her own business now) and then did a non-deductible contribution (for 2022) into her Rollover IRA and did the backdoor to Roth IRA finally. So I thought we were in good shape -- her Trad/Rollover IRA now had $0 balance and she was all set up for 2023.
There was just one mistake -- I blanked on the contribution limit and only contributed $5000 last year, leaving $1,000 leftover for 2022. Thus, I want to contribute before April 15 this year for 2022 the remaining $1,000. I want to also contribute the maximum $6,500 this year for her and do the backdoor for 2023.
Any advice on how to do this, and whether there's any timing restrictions? Should I do the $1,000 contribution separately, distribute that over to the Roth first, and then do the $6,5000 after to keep things clean? Is there a danger to doing it this way on how to report on my taxes? I've only usually done same-year contribution and distribution so my TurboTax is easy, but not sure if I'm over-complicating it this time.
I've been doing backdoor Roth IRA contributions for many years on my account. We never did it on DW's account because she had a bunch of rollover money from an old 401(k) mixed with non-deductible contributions back when she was making more and before Backdoor Roths were allowed, and I never wanted to sort through it (kind of a mistake).
Last year I finally sorted out her non-deductible basis from old tax returns and memory, and rolled over the pre-tax into a non-prototype Solo 401(k) (DW has her own business now) and then did a non-deductible contribution (for 2022) into her Rollover IRA and did the backdoor to Roth IRA finally. So I thought we were in good shape -- her Trad/Rollover IRA now had $0 balance and she was all set up for 2023.
There was just one mistake -- I blanked on the contribution limit and only contributed $5000 last year, leaving $1,000 leftover for 2022. Thus, I want to contribute before April 15 this year for 2022 the remaining $1,000. I want to also contribute the maximum $6,500 this year for her and do the backdoor for 2023.
Any advice on how to do this, and whether there's any timing restrictions? Should I do the $1,000 contribution separately, distribute that over to the Roth first, and then do the $6,5000 after to keep things clean? Is there a danger to doing it this way on how to report on my taxes? I've only usually done same-year contribution and distribution so my TurboTax is easy, but not sure if I'm over-complicating it this time.