How much tax will I pay on a Roth conversion?
A conversion adds to your income for the year, so it's taxed on top of everything else, at your highest rates. It doesn't all fall in one bracket. In the lede's example, $41,800 is taxed at 22% and $8,200 at 24%. A much larger $250,000 conversion on the same income costs $69,864, or 27.9% of the amount, with its last dollars taxed at 35%.
| Convert | $40,000 income | $80,000 income | $120,000 income | $200,000 income |
|---|---|---|---|---|
| $10,000 | $1,200 | $2,200 | $2,364 | $2,400 |
| $25,000 | $3,000 | $5,500 | $5,964 | $6,570 |
| $50,000 | $8,350 | $11,164 | $11,964 | $14,570 |
| $100,000 | $19,714 | $23,164 | $24,134 | $31,400 |
| $200,000 | $45,484 | $52,364 | $57,564 | $66,400 |
The conversion itself doesn't draw the 10% additional tax, even under 59½, if the money moves properly into the Roth. It's the part you keep out that can. There's also no undo. Conversions made after 2017 can't be recharacterized back to a traditional IRA, so check the numbers first.
How much of a Roth conversion should I do?
One approach to test is filling your current bracket, stopping there, and repeating in later years. Spreading a conversion can keep more of it out of higher brackets. The room depends on your income. A single filer with $80,000 of income has $41,800 left in the 22% bracket. This is arithmetic and not a rule, since the right amount depends on your future tax rate too.
| Filing status | Income before conversion | Current bracket | Convert up to | Federal tax |
|---|---|---|---|---|
| Single | $80,000 | 22% | $41,800 | $9,196 |
| Single | $150,000 | 24% | $67,875 | $16,290 |
| Married, joint | $120,000 | 12% | $13,000 | $1,560 |
| Married, joint | $250,000 | 24% | $185,750 | $44,580 |
The years between retiring and starting RMDs and Social Security can be lower-income years, which makes them worth testing. You can't convert an RMD itself, so in an RMD year, take that first. Check the RMD calculator to see what you might be reducing.
Is a Roth conversion worth it? The break-even tax rate
It mostly comes down to your tax rate now against your tax rate later. Paying 22.3% now beats paying more than that later, and loses to paying less. Paying from outside the IRA lowers the break-even further, here to 18.8%, because the tax money would otherwise sit in a taxable account that loses some of its return to tax each year. That drag, 15% of the return here, is an example you can change.
| Future tax rate | Convert | Leave it | Converting gains |
|---|---|---|---|
| 10% | $160,357 | $174,512 | -$14,155 |
| 12% | $160,357 | $171,305 | -$10,948 |
| 15% | $160,357 | $166,494 | -$6,137 |
| 22% | $160,357 | $155,269 | $5,088 |
| 24% | $160,357 | $152,062 | $8,295 |
| 32% | $160,357 | $139,233 | $21,123 |
| 37% | $160,357 | $131,216 | $29,141 |
Nobody knows future tax rates, so a break-even is more useful than a single answer. If it's well below any rate you can imagine paying later, converting looks strong. If it's above your likely rate, it doesn't. RMDs matter here because they can push your later rate up, and this tool doesn't model that.
Can I pay the conversion tax from the IRA itself?
You can, but it costs more than it looks. Money held back isn't converted, so it's a taxable distribution. Under 59½, its taxable part can also draw the 10% additional tax unless an exception applies. Holding back the tax on the $50,000 example leaves $38,836 in the Roth at 60 or older, and $37,596 if you're younger, after $1,240 of additional tax.
With tax held back, the break-even rate rises to 22.3% at 60 or older and 24.8% if younger, compared with 18.8% paying from outside. Compared fairly, with the outside money staying invested, paying from outside comes out $5,614 ahead after 20 years at 60 or older. The gap comes only from that money's tax drag, so it shrinks if your outside money is taxed lightly.
How does the pro-rata rule affect a backdoor Roth?
You can't convert only your after-tax dollars. Form 8606 spreads your basis, meaning nondeductible contributions, across all your traditional, SEP, and SIMPLE IRAs. Say you make a $7,500 nondeductible contribution and convert $7,500, but you have $100,000 in IRAs in all. Only 7.5% of the conversion is tax free, so $6,938 is taxable. It's easy to expect no tax at all here, and that's the trap.
Form 8606 uses your balances at the end of the year, so a conversion in January still counts what's in your IRAs on December 31. Workplace plans aren't part of that total. Keep your Form 8606 records, because they're how you prove your basis later and avoid paying tax on it twice.
What this Roth conversion calculator does not model
A conversion raises your income for the year, which can change other things. These aren't in the tool's tax figure, so your real cost can be higher.
- Medicare premiums (IRMAA). Higher income can raise your Part B and Part D premiums.
- Social Security taxation. Your other income helps decide how much of your benefit is taxed, under Publication 915. A conversion can make more of it taxable.
- Capital gains and credits. The tool treats all income as ordinary. Extra income can move long-term gains into a higher rate and shrink income-based credits.
- State tax. You can enter a flat rate, but states treat conversions differently.
From age 65, the tool does include the extra standard deduction and the larger senior deduction, which shrinks as your income rises. Each conversion also starts its own 5-year period: withdrawing converted money within 5 years while under 59½ can draw the 10% additional tax. Because the stakes are high and a conversion is permanent, it's worth asking a tax professional to run your actual return. To see the bigger picture on brackets, read how federal income tax works.
Common questions
What is a Roth conversion?
It's moving money from a traditional IRA to a Roth IRA. You generally pay income tax on the amount moved in the year you convert, except any part that's your basis. Qualified withdrawals later are tax free.
Is there a limit on how much I can convert?
The annual IRA contribution limit doesn't apply to a conversion, which is treated as a rollover. The real limit is the tax bill, since the whole taxable amount is added to your income.
Can I convert after I start taking RMDs?
Yes, but you can't convert the RMD itself. IRS Publication 590-A says amounts that must be distributed for the year can't be converted, so take that first and convert other money afterward.
When is the tax due on a conversion?
It's part of your tax for the year you convert. Since no one withholds it automatically when you pay from outside, you may need to raise your withholding or make estimated payments. IRS Publication 505 explains how.
Can I undo a Roth conversion?
No. A conversion made after 2017 can't be recharacterized back to a traditional IRA, so be sure before you do it.
How is this different from the Roth IRA calculator?
This one tests moving money you already have, and the tax that triggers. The Roth IRA calculator projects growth from new contributions and shows your contribution limit.
Sources
- Publication 590-A: Contributions to Individual Retirement Arrangements · Internal Revenue Service
- Publication 590-B: Distributions from Individual Retirement Arrangements · Internal Revenue Service
- Instructions for Form 8606: Nondeductible IRAs · Internal Revenue Service
- Revenue Procedure 2025-32: 2026 tax brackets and standard deduction · Internal Revenue Service
- Publication 915: Social Security and Equivalent Railroad Retirement Benefits · Internal Revenue Service
- Medicare costs · Centers for Medicare & Medicaid Services