How to Establish a Backdoor Roth IRA

With a Roth IRA, you can make tax-free withdrawals at retirement. Vitalii Vodolazskyi/Shutterstock

A backdoor Roth IRA allows you to transfer nondeductible contributions from a traditional IRA into a Roth IRA.

With a Roth IRA, you can make tax-free withdrawals at retirement. This can be especially useful for affluent individuals who earn too much to directly contribute to a Roth IRA.