# Backdoor Roth conversion confusion

**URL:** <https://community.clark.com/t/backdoor-roth-conversion-confusion/6826>\
**Category:** Investing\
**Created:** [January 6, 2025, 12:42am UTC](https://community.clark.com/t/backdoor-roth-conversion-confusion/6826 "2025-01-06T00:42:10Z")\
**Posts on this page:** 3\
**Page:** 1

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**Author:** ![Bil](https://avatars.discourse-cdn.com/v4/letter/b/f07891/32.png) [@Bil](https://community.clark.com/u/Bil)\
**Post date:** [January 6, 2025, 12:42am UTC](https://community.clark.com/t/backdoor-roth-conversion-confusion/6826/1 "2025-01-06T00:42:10Z")

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I have a Roth IRA from years prior that I had contributed to when able. I had a large jump in income after finishing training and made a max contribution to the Roth IRA in 2023 that I had to recharacterize into a traditional IRA once I realized that I was going to be over over the income limit. I put that money in a VSTAX fund and let it sit there. At the end of December 2024 I put in another $7000 to max out the limit, but this money is just in the money market account not invested as I planned on rolling into my Roth IRA with a backdoor conversion. Looking further into backdoor Roth conversion I’m realizing that I probably am in for a headache.

The amount in the VSTAX fund hasn’t grown much, but I realize that I will need to pay tax on the earnings if I convert it.

I’m confused on the pro-rata rule, and what I’m actually able to conver here.

Can I just covern the total currently in the Traditional IRA to my Roth with a backdoor conversion, accounting for taxes on the earnings in the money sitting in the VSTAX fund?

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**Author:** ![ladybuglake](https://sea2.discourse-cdn.com/flex016/user_avatar/community.clark.com/ladybuglake/32/170_2.png) [@ladybuglake](https://community.clark.com/u/ladybuglake)\
**Post date:** [January 16, 2025, 12:39am UTC](https://community.clark.com/t/backdoor-roth-conversion-confusion/6826/2 "2025-01-16T00:39:52Z")

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Conversions have to be taxed, and I never head of using traditional money for a back door. I am only an investor like you, and asked those questions before. I think a back door has to be new money. I forgot how it works however. There are no options but back door, but i forgot the rules.

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**Author:** ![clydewolf](https://avatars.discourse-cdn.com/v4/letter/c/839c29/32.png) [@clydewolf](https://community.clark.com/u/clydewolf)\
**Post date:** [January 19, 2025, 3:01am UTC](https://community.clark.com/t/backdoor-roth-conversion-confusion/6826/3 "2025-01-19T03:01:08Z")

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This link to White Coat Investor may help:

> **[How to Do a Backdoor Roth IRA \[Step-by-Step Guide\] | White Coat Investor](https://www.whitecoatinvestor.com/backdoor-roth-ira-tutorial/)**
>
> This Backdoor Roth IRA tutorial takes you step-by-step through the contribution process, including Form 8606, tax implications, common mistakes, and lots more.