I'm doing a backdoor ROTH for the first time with Fidelity. My understanding is the process is simple:
- Create or have a Traditional IRA
- Create or have a ROTH IRA
- Put post-tax money into Traditional IRA
- "Convert Traditional IRA to ROTH IRA"
- Fill out appropriate tax forms come tax-time to show the converted amount
There are various guides on how to do this on various platforms, but what confuses me is the exclusive use of the term "convert". Within Fidelity's current website, this is a simple transfer (between the Trad IRA and ROTH IRA). Nowhere else have I seen the process described with that verbiage. Further, the verbiage has always confused me: you're simply moving money from one container (Trad IRA) to another (ROTH IRA); the money itself isn't undergoing any conversion in the same way withdrawing from my 401k isn't a "conversion", it's simply a withdrawal. I know it might be overly pedantic, but the IRS seems like the type of organization to be pedantic.
Is there a special operation that I have to use to safely move money between a Trad IRA and Roth IRA in a tax-safe, Backdoor-ROTH-friendly way, or is it as simple as moving money between the two account types - similar to how one would transfer any money between any accounts?
Note: I'm ignoring complications such as the pro-rata rule for this example.