The following is a situation a few of my friends are in:
- Significant assets in traditional IRA
- Income above Roth IRA limits
- Their 401k plan allows you to roll regular IRAs into it
Now, the prorata rule prevents them from having a tax-free backdoor Roth IRA because of their traditional IRA assets.
But if they roll the traditional IRA into their 401k, does this mean you can do a regular Backdoor Roth IRA in the same calendar year that you roll your traditional IRA into the 401k without tax implications?
Or would they have to wait until the following year?