Back Door Roth

The back-door IRA is sometimes also likened to a contribute and convert strategy. In essence, for high income earners who make too much earned income  to contribute to a Roth IRA outright, there’s always the option to invest in a traditional IRA. Anyone can do that as long as you have earned income. The question is whether the contribution would be deductible or not. With this back-door Roth feature, you contribute to a traditional IRA and then shortly thereafter, convert it to a Roth.  It's a two-step process to get to a Roth where you wouldn’t be able to it directly because your earned income is too high.