In the United States, does having a rollover IRA impact your basis for converting a traditional to Roth? I ask because I have a 401(k) with a former employer than I could rollover to an IRA and get some free money as incentive from the custodian for the transfer, however, I'm concerned that this would impact my ability to contribute each year to a traditional IRA as a non-deductible contribution with 100% basis and then turn around and convert to Roth and avoid the income limitation on contributing to a Roth and pay no taxes on the conversion. When you convert to Roth, the portion of all your IRAs that are converted as well as your total basis of non-deductible contributions are considered and the ratio of total IRA balances converted determines how much of your deductible non-basis is applied as income. Without the rollover, my deductible basis is 100%.
My question is whether the traditional IRA is segregated for this basis calculation or would I lose or water down this benefit if I converted by 401(k) with deductible contributions to a rollover IRA?