Backdoor Roth IRA and Pro-rata Rule

[Alex Yakubovich]

Hello everyone!

Could you please help with my situation? I want to do a Backdoor Roth but I have pre-tax money on my trad IRA and I don't understand whether the pro-rata rule could be avoided if I do the following:

1) All money on my trad IRA is pre-tax.
2) I want to open Solo 401(k) and transfer all pre-tax money (10k) from trad IRA to Solo 401(k).
3) When the balance on trad IRA will be zero I am going to add after-tax money to my trad IRA up to the yearly limit (6k).
4) I am converting all after-tax money from trad IRA to Roth IRA.
5) To the end of the year I will have trad IRA with zero dollars, Solo 401(k) with after-tax money (10k), and Roth IRA with after-tax money (6k).

Will pro-rata rule be avoided if I do 1)-5) in one year?

Thank you very much!