Roth Conversion Calculator
Compare converting to Roth now (pay tax today) versus leaving money traditional (pay tax in retirement), and find the retirement tax rate where the two tie.
Last updated: October 2026
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The core question, simplified
A Roth conversion asks one question: pay tax now or pay tax later? Convert and you pay income tax on the amount today; it then grows tax-free forever. Leave it traditional and the full amount grows, but you pay income tax on the whole pile when you withdraw. Here is the insight that makes the math clean: the growth factor is identical on both paths, so years to grow and rate of return cancel out of the comparison. The entire decision reduces to comparing your tax rate today against your expected tax rate in retirement.
When converting wins
Converting wins when your retirement tax rate will be higher than today's rate. That happens more often than people expect: required minimum distributions can push retirees into higher brackets, a spouse's death can force single-filer brackets on the survivor, and today's historically low rates may not last. Converting also wins in low-income years: early retirement before Social Security starts, a sabbatical, or a year between jobs can be a golden window to convert at 10% or 12%. The breakeven retirement rate this calculator shows equals your current rate: expect to land above it in retirement, and converting pays.
When waiting wins
Waiting wins when your retirement rate will be lower than today's: the classic case is a high earner in the 32% or 35% bracket now who will retire into the 22% or 24% bracket. It also wins when you cannot pay the conversion tax from outside funds: raiding the converted amount to pay the tax shrinks the Roth and can trigger the 10% early-withdrawal penalty under 59 and a half. And it wins when the conversion itself would spike this year's income into the next bracket, or trigger Medicare IRMAA surcharges two years later: bracket management matters as much as the rate comparison.
Worked example
Convert $10,000 at a 22% current rate, with 20 years at 7% and a 12% expected retirement rate. Growth factor: 1.07^20 = 3.8697. Convert now: $10,000 x 0.78 x 3.8697 = $30,184 tax-free. Wait: $10,000 x 3.8697 x 0.88 = $34,053 after tax. Waiting wins by about $3,870 because the 12% retirement rate beats the 22% rate today. Flip the retirement rate to 24% and converting wins by a similar margin: the rate comparison is the whole game.
Execution tips
Fill brackets, don't spill them. Convert just enough each year to fill your current bracket without crossing into the next: partial conversions over several years beat one giant conversion. Pay the tax from cash. Using outside funds keeps the full amount compounding tax-free. Mind the calendar. Conversions count in the calendar year they happen, so December conversions need the cash ready. Watch the side effects. Extra income can phase out credits, raise Medicare premiums, and push capital gains into higher rates: model the full return, not just the conversion line. When in doubt, convert a smaller test amount first: you will learn your true all-in cost from the actual tax return.
Roth Conversion FAQs
What is a Roth conversion?
You move money from a traditional IRA or 401(k) into a Roth account, pay income tax on the converted amount now, and never pay tax on it again: qualified Roth withdrawals in retirement are completely tax-free, including all the growth.
When does converting to Roth win?
When your tax rate in retirement will be higher than your rate today. The growth factor is identical on both paths, so the whole comparison reduces to one question: is (1 minus today's rate) bigger than (1 minus retirement's rate)? This calculator shows both final values and the breakeven rate.
What is the breakeven retirement tax rate?
The retirement tax rate at which converting now and waiting tie exactly: it equals your current marginal rate. If you expect your retirement rate to land above it, convert; below it, wait. The calculator displays it so you can judge your own forecast.
Do I need cash outside the IRA to pay the conversion tax?
Ideally yes. Paying the tax from outside funds keeps the full converted amount growing tax-free, which is where the math shines. Paying the tax from the converted amount itself shrinks the Roth and weakens the case, especially before age 59 and a half when withholding can trigger penalties.
What is the five-year rule?
Each Roth conversion has its own five-year clock: withdraw converted principal before five years pass and you may owe a 10% penalty on it if you are under 59 and a half (the tax was already paid at conversion). After five years and age 59 and a half, withdrawals are fully qualified and tax-free.
Can a conversion push me into a higher bracket?
Yes, and this is the classic conversion mistake: the converted amount adds to this year's taxable income, so a large conversion can shove part of itself (and your other income) into the next bracket. Many people convert in smaller annual slices to fill up their current bracket without spilling into the next one.
Does converting affect Medicare premiums?
It can. The converted amount raises your modified adjusted gross income, which can trigger IRMAA surcharges on Medicare Part B and D premiums two years later. If you are near 65, model the premium hit before converting a large amount.