Roth Conversion Calculator and Bracket Guide

You have a pre-tax individual retirement account (IRA) or old 401(k) sitting somewhere. Someone, your CPA, a YouTube video, a friend at dinner, tells you to "look into a Roth conversion." You sort of know what that means: pay tax now, get tax-free growth and withdrawals later. But you've never run the numbers on your situation, and the decision can feel like a coin flip.

The math is answerable, though. Whether a Roth conversion makes sense for you depends on a handful of things you can pin down: your current tax bracket, your expected retirement bracket, the years between now and when you'd withdraw, and a few side effects most articles skip over. This guide walks through all of it, with a calculator below so you can see the answer for your numbers.

What a Roth Conversion Is

A Roth conversion is the act of moving money from a pre-tax retirement account (Traditional IRA, old 401(k), pre-tax 403(b)) into a Roth account. You pay ordinary income tax on the converted amount in the year of the conversion. After that, the money sits in a Roth, where it grows tax-free and qualified withdrawals in retirement are tax-free too.

That's the whole mechanic. The interesting part is when it pays off.

The Core Question: Bracket Arbitrage

The whole game is a bet on tax brackets. Specifically, you're comparing two paths for the same dollar:

• Path A, Convert now. Pay tax at your current marginal bracket, then let the after-tax dollars grow tax-free in a Roth.
• Path B, Don't convert. Let the dollar grow pre-tax, then pay tax on the entire balance (principal plus all the growth) at your bracket in retirement.

If you'll be in a lower bracket in retirement, Path B usually wins: defer the tax to when it's cheap. If you'll be in a higher bracket in retirement, Path A wins: pay the tax now while it's cheap. If the brackets are the same, it's mathematically a wash (assuming same growth rate), and the tiebreakers below decide it.

So start with the bracket you expect to be in during retirement. Most people guess "lower," but for high earners with large tax-deferred balances, that's not always true. Required minimum distributions (RMDs) at 73 (75 if you were born in 1960 or later), Social Security, and pension income can all push retirement income higher than people assume.

Run Your Numbers

Treat the number above as directional. Real conversion math involves more factors than the calculator captures (the next two sections cover them). It can show you whether you're in "convert now" territory, "wait" territory, or close enough that the tiebreakers decide.

When a Roth Conversion Usually Makes Sense

A few specific situations push the math toward conversion:

1. The post-retirement, pre-RMD window. If you retire before your RMD age (73 or 75) and delay Social Security, your reported income drops sharply. The years between retirement and RMDs are often the lowest-bracket years of your adult life. Converting in that window, filling up the lower brackets each year without spilling into the next one, is one of the most valuable moves a pre-retiree can make.

2. A big income drop year. Sabbatical, business loss year, between jobs, year of a major charitable bunch. The bracket drops, conversion gets cheaper.

3. You expect higher future taxes generally. This goes beyond your own bracket: rates across the board could be higher. The July 2025 tax law removed the scheduled 2026 sunset of today's brackets, but a future Congress can still change them, and federal debt projections suggest pressure on rates over decades.

4. Estate planning for heirs. Inherited Roth accounts pass tax-free; inherited Traditional IRAs don't. If you expect to leave a large retirement balance to children in their peak earning years, converting can reduce their tax bill on the inheritance.

5. The "fill up the bracket" play. Even if you'd never convert your whole balance, partial conversions that exactly fill the current bracket without crossing into the next one are usually a no-regret move. Convert enough to use the rest of your 22% bracket and stop before you hit 24% (in 2026, the 22% bracket tops out at $211,400 of taxable income for married couples filing jointly and $105,700 for single filers).

When It Doesn't (or Costs You)

Three watchouts that most calculators (including the simple one above) ignore:

Affordable Care Act (ACA) premium tax credits. If you're under 65 and getting health insurance through the marketplace, your modified adjusted gross income (MAGI) determines your subsidy. A large Roth conversion can wipe out a $10,000+ subsidy in a single year. The enhanced subsidies expired at the end of 2025, so for 2026 the cliff at 400% of the federal poverty level is back: a dollar of income over it can end the credit entirely. Run the conversion math with and without the subsidy loss before deciding.

Medicare IRMAA brackets. Once you're 65+, your Medicare Part B and D premiums are based on MAGI from two years prior, so conversions from age 63 onward can count. A big conversion in a single year can push you into a higher Income-Related Monthly Adjustment Amount (IRMAA) tier, raising premiums for the year two years later. Spreading conversions across multiple years usually beats a single big one.

State tax considerations. Converting in a high-tax state (CA, NY, OR, NJ) and then moving to a no-tax state (FL, TX, NV, WA) loses the arbitrage opportunity. If a state move is realistic in the next few years, deferring conversions until after the move can save 5% to 10% in state tax on the converted amount.

The 5-Year Rule (Don't Skip This)

Two five-year clocks apply to Roth accounts, and people confuse them constantly:

1. The 5-year clock for tax-free earnings. You have one clock for all your Roth IRAs, starting January 1 of the year you first funded any Roth IRA (by contribution or conversion). Earnings come out tax-free only once that clock has run and you're 59½ (or meet another exception, such as disability or death). Withdraw earnings before then and you may owe income tax on them, plus a 10% penalty if you're under 59½.
2. The 5-year rule for converted principal. Each conversion starts its own five-year clock (from January 1 of the conversion year). If you're under 59½, withdrawing that converted principal before its clock runs triggers the 10% penalty. Doesn't apply if you're 59½ or older.

For pre-retirees over 59½, the conversion clocks no longer matter, and the earnings clock matters only if your first Roth IRA is less than 5 years old. For early retirees doing a Roth conversion ladder before 59½, the 5-year clock is the entire mechanism that makes the strategy work.

The Pro-Rata Rule for Backdoor Conversions

If you're a high earner doing a backdoor Roth (contributing to a Traditional IRA and converting it the same year because your income is too high for direct Roth contributions), the pro-rata rule can wreck the strategy.

The IRS treats all your Traditional IRA balances as one pool when calculating the taxable portion of a conversion. If you have, say, $90,000 of pre-tax money in an old rollover IRA and you contribute $7,500 (the 2026 limit) of after-tax money to a new Traditional IRA and convert that $7,500, the IRS treats the conversion as a slice of your aggregate $97,500 pool, which is only about 7.7% after-tax money. Result: about 92.3% of your conversion is taxable.

The fix is to roll the pre-tax IRA balance into a 401(k) before the conversion. 401(k) balances don't count toward the pro-rata calculation. Most 401(k) plans accept rollovers in. Get the timing right: roll in by December 31 of the conversion year. If you have access to an after-tax 401(k) sub-account, the mega backdoor Roth is the next step up.

Common Mistakes

• Converting in a year you also have a big bonus or restricted stock unit (RSU) vest. You stack two pieces of income, push yourself into a higher bracket than you would have hit naturally, and the conversion math suffers.
• Forgetting that the tax has to come from somewhere. The cleanest conversion uses outside cash (a taxable brokerage account) to pay the tax, leaving the full converted amount in the Roth. Using converted dollars to pay the tax shrinks the Roth balance and hurts the math.
• Converting in November/December without checking estimated taxes. Big conversions often need a fourth-quarter estimated payment to avoid an underpayment penalty.
• Converting and then changing your mind. Recharacterizing a conversion was eliminated by the 2017 tax law. Once you convert, you can't undo it. Be sure.

Frequently Asked Questions

How much can I convert in a year?

There's no annual limit on Roth conversions. You can convert any amount in any year. The practical limit is the tax bill: you have to be willing to pay ordinary income tax on the entire converted amount.

Should I do one big conversion or several small ones?

For most people, several smaller conversions across multiple years works better. It avoids spiking into a higher tax bracket, avoids IRMAA cliffs, and gives you flexibility to react to changes in tax law or your own situation. The exception is a single low-income year (e.g., the year you retire) where a one-time larger conversion can take advantage of an unusually low bracket.

Can I convert from a 401(k) directly to a Roth IRA?

Yes, this is called a Roth rollover or in-plan Roth conversion (if your plan supports it). The mechanics are the same: you pay tax on the converted amount in the year of the conversion. If you're doing it as a rollover from an old 401(k), you can roll directly to a Roth IRA at a custodian of your choice.

What's the deadline to convert for the current tax year?

December 31. Unlike contributions, conversions don't get the April-15-of-the-following-year deadline. Whatever you convert by December 31 counts toward that calendar year's income.

Do conversions count toward Required Minimum Distributions?

No. Roth conversions don't satisfy your RMD. Once RMDs have started (at 73, or 75 if you were born in 1960 or later), you have to take your RMD first, and only after that can you convert additional amounts. The RMD itself can't be converted.

How does a conversion affect my Medicare premiums?

If you're 65+, your IRMAA tier (which determines Part B and Part D premium surcharges) is set by MAGI from two years prior. A conversion this year affects premiums two years from now. The cliffs are sharp: in 2026, a single dollar over the first threshold ($218,000 married filing jointly, $109,000 single) raises Part B from $202.90 to $284.10 a month per person, $81.20 more, plus a Part D surcharge, for the whole year. Higher tiers cost more. Always model conversions against IRMAA brackets if you're on Medicare.

Is a Roth conversion right for me at age 70?

It depends on your specific bracket today, your expected bracket once RMDs start at 73, and whether you have heirs in higher brackets. For some 70-year-olds the answer is yes, for others no. The pre-RMD window (ages 70 to 73) is short but valuable; worth running the numbers.

What to Do This Week

1. Pull your most recent tax return and find your marginal bracket. (Look at the highest bracket your last dollar of income hit, not your effective rate.)
2. Estimate your retirement bracket. Take projected Social Security + pension + RMDs (rough estimate is your IRA balance ÷ 25 in your first RMD year) + any other expected retirement income, and find the bracket that lands you in.
3. Run the calculator above with those two numbers.
4. If the answer leans "convert," don't convert the whole balance at once. Sketch a multi-year plan that fills your current bracket without spilling over.
5. Talk to your advisor or CPA before pulling the trigger, especially if you're under 65 (ACA), over 65 (IRMAA), or considering a state move.

A Roth conversion is a tradeoff with a numeric answer. Once you've run the numbers for your situation, you have either a reason to convert or a reason to wait.