Roth conversions are one of the most powerful tax planning strategies available — and in 2026, they’re especially attractive. With potentially higher tax rates on the horizon and current brackets still favorable, converting Traditional IRA money to Roth now could save you tens of thousands in retirement taxes.
But the strategy is nuanced. Convert too much and you’ll spike your tax bill. Convert too little and you’ll miss the window. Here’s the complete playbook.
What Is a Roth Conversion?
Moving money from a Traditional IRA (pre-tax) to a Roth IRA (post-tax). You pay income tax on the converted amount now, but all future growth and withdrawals are tax-free forever. No Required Minimum Distributions (RMDs) either.
When Roth Conversions Make Sense
- You’re in a lower tax bracket now than you expect to be in retirement
- You’re between jobs or have a low-income year
- The market crashed (convert at the low — less tax, more growth potential)
- You want to avoid RMDs starting at age 73
- You want to leave tax-free money to heirs
- You believe future tax rates will be higher
The “Fill Up the Bracket” Strategy
The key is to convert just enough to fill your current tax bracket without jumping to the next one.
| If your taxable income is… | Convert up to… (to stay in bracket) | Tax Rate |
|---|---|---|
| $50,000 (single) | $50,525 more (to top of 22%) | 22% |
| $75,000 (single) | $25,525 more | 22% |
| $100,000 (single) | $525 more (nearly full) | 22% |
| $120,000 (married) | $81,050 more (to top of 22%) | 22% |
Use Richify’s free Roth Conversion Calculator to model your exact scenario and find the optimal conversion amount.
The 5-Year Rule
Roth conversions must “season” for 5 years before you can withdraw the converted amount penalty-free (if under 59½). Each conversion has its own 5-year clock. Earnings can be withdrawn tax- and penalty-free after age 59½ AND 5 years from your first Roth contribution.
Multi-Year Conversion Strategy
Rather than converting $500,000 all at once (which would spike you into the 37% bracket), spread conversions over 5–10 years, converting $50,000–$80,000 per year to stay within the 22–24% bracket. Over a decade, you’ll convert the entire amount at lower effective rates.
Watch Out: Hidden Tax Traps
- IRMAA surcharges: Converting too much can increase your Medicare premiums 2 years later
- Social Security taxation: Conversions increase your income, potentially making up to 85% of Social Security taxable
- Net Investment Income Tax: 3.8% surtax kicks in above $200K single / $250K married
- Pro-rata rule: If you have both pre-tax and after-tax IRA money, you must convert proportionally
Frequently Asked Questions
Should I pay the conversion tax from the IRA itself?
No. Pay taxes from a separate account (checking/savings). If you use IRA funds to pay taxes, those withdrawn funds may be subject to the 10% early withdrawal penalty if under 59½, and you lose the future tax-free growth on that amount.
Can I undo a Roth conversion?
No. Since the Tax Cuts and Jobs Act of 2017, recharacterizations of Roth conversions are no longer allowed. Once you convert, it’s permanent. Plan carefully.
🚀 Take Control of Your Finances with Richify
Model your optimal Roth conversion strategy. Use the free Roth Conversion Calculator to find the sweet spot that minimizes your lifetime tax bill.
📱 Download the Richify app to track your Traditional and Roth IRA balances and plan your conversion strategy.
Disclaimer: This article is for educational purposes only. Roth conversions have significant tax implications. Consult a qualified tax advisor before converting.
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