As we all know, Roth IRAs have income limits that prohibit individuals from contributing to a Roth IRA if their Modified Adjusted Gross Income is over a certain limit ($133,000 for individual contributors, and $196,000 for a married couple filing jointly in 2017).
It is my understanding that one way around this restriction is to use a Backdoor Roth IRA, where a traditional IRA can be converted into a Roth IRA. Any pre-tax income that has been placed into a traditional IRA is taxed when it is converted into a Roth IRA, and any post-tax income is not.
My question is: doesn't this allow people to get around the MAGI income limit restriction on a Roth IRA? If someone can just convert their Traditional IRA to a Roth IRA with no penalty (other than the tax they would have had to pay to contribute to the Roth IRA in the first place which isn't really a penalty), doesn't it mean that the limits on Roth IRAs are basically irrelevant or easily avoided?