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      What is a backdoor Roth contribution and how do I make one?

      Backdoor contributions allow you to contribute to a bitcoin Roth IRA even if your income exceeds the IRS income ceiling.

      Each year, individuals can make a contribution up to the current IRA annual contribution limit to a Roth IRA. Eligibility to contribute to a Roth IRA is determined by the IRS-stated threshold for individuals. If your income exceeds this threshold, you must fund a Traditional IRA first and then convert it to Roth tax status. Note that if you have existing Traditional IRA balances that are unconverted to Roth, a backdoor Roth contribution may create tax consequences. Please consult your tax advisor.

      What you’ll need:

      • An Unchained Roth IRA

        • Creating a vault is not required to initiate the backdoor contribution. You can upload keys and build a vault at your convenience. 

      • A Traditional IRA

        • If you do not already have an Unchained Traditional IRA, Fortis will create a temporary conversion-only Traditional IRA account on your behalf to process the conversion.

      Note: Fortis Bank will charge a $100 banking service fee for the conversion.  

      To make a backdoor Roth contribution:

      1. Sign in to your Unchained account and navigate to your IRA dashboard.
      2. Select IRA cash balance and click FUND. 

      3. Select Annual Contribution and Continue.

      4. Select Roth Account Type and Yes for backdoor Roth contributions. 

      5. Submit Form.

      6. Our IRA team will receive your responses and send you a funding form via DocuSign, typically within 1 business day. 

        1. Depending on your personal email settings, you may need to check your spam folders for the DocuSign form. 

      7. Sign and return the DocuSign. 

      8. Send your funds to Fortis Bank via paper check or wire transfer. 

      9. Fortis Bank will perform the Roth IRA conversion upon receiving your funds. 

        1. The USD will flow through your Traditional IRA or (newly opened conversion-only Traditional IRA account) before the conversion to your Roth IRA account cash balance.

      10. Once the funds arrive in your account, you can purchase bitcoin. 

      No contents of this article may be relied upon as tax, legal, or financial advice, as they have not been tailored to you and have not been reviewed by any attorney, financial advisor, or tax professional. For any questions related to your own specific situation, please consult with your own attorney, tax professional, and/or licensed financial advisor.