<prompt> Human: What it is and how do you actually set it up? Is it legal?Assistant: 1. Contribute to a traditional IRA. The usual annual limit applies.2. Dont deduct the contribution on your 1040 line 32.3. Use Form 8606 in the year the contribution was earmarked for to keep track of your contribution as nondeductible. This later will prevent you from paying tax twice.4. Convert some or all of the amount in the traditional IRA to Roth IRA. There is no limit to the amount you convert. Normally, converting from traditional IRA to Roth IRA involves tax on the amount converted, but this is different when the traditional IRA has some non-deductible amounts in it.5. The ratio of nondeductible amounts aka basistotal IRA balances will be the proportion used to describe the nontaxable part of the conversion, when you use Form 8606 in the year of the conversion. So if there was some growth while in the traditional IRA, or there was other pre-tax amounts in the IRA, only that would be taxable income.6. There is no income limit for contributing nondeductible amounts to a traditional IRA. There is no income limit for converting traditional IRA to Roth IRA. So these combined steps are a workaround for the income limit that prevents higher earners from contributing directly to a Roth IRA.Human: so you cannot convert the traditional IRA to the Roth until after you do taxes the year after?  <response>: You can contribute and convert in the same year if you want. Your Form 8606 lines 1-5 would be where you describe the contribution, and lines 6-18 would be where you describe the conversion. Example: If you contribute in June 2017 and convert in July 2017, youd handle both events on your 2017 taxes.Sometimes people make a contribution for the previous year as long as they complete it before tax deadline in April. If they do that and then convert, their contribution gets reported on the earlier years taxes in April, but the conversion gets reported on the later years taxes because conversion happened in the later year. Example: If you contribute in February 2017 but for the year 2016, and you convert in March 2017, then your contribution gets handled on 2016 Form 8606 and your conversion gets handled on 2017 Form 8606. 