See whether converting a Traditional IRA or 401(k) to a Roth pays off after-tax — and how much you save over a lifetime.
Free Roth-conversion planner. Model the upfront tax bill, the tax-free growth, and the side-by-side after-tax position at retirement against doing nothing.
Direct answers to the most common questions, in plain language. Skim if you're in a hurry; dig deeper below.
Usually yes if your tax rate is lower today than in retirement.
A Roth conversion pays the tax bill upfront so withdrawals later are tax-free. It wins when your current marginal rate is below your expected retirement rate, you have decades of growth left, and you can pay the tax bill from outside the IRA.
The converted amount is added to ordinary income for that year.
The IRS treats a conversion as a taxable distribution. The dollars you move land in the Roth as basis, but you owe ordinary income tax on the full conversion amount in the year you do it.
Partial conversions let you fill lower tax brackets without spilling into higher ones.
Most people convert only the amount that fits inside their current bracket. Filling the 12% or 22% bracket each year is a popular "Roth conversion ladder" — slow, deliberate, and bracket-aware.
Each conversion starts its own 5-year clock for penalty-free principal access.
You can always withdraw the converted principal tax-free, but to avoid a 10% early-withdrawal penalty before age 59½ you must wait 5 tax years from each conversion. Withdrawn earnings have their own rules.
The mechanics in short answers — no jargon, no upsell.
You move dollars from Traditional to Roth. The IRS treats that as income — so you owe ordinary income tax on the full amount this year.
Using outside cash to pay the conversion tax keeps your invested base intact. Paying from the IRA itself shrinks the Roth seed and weakens the math.
If your retirement marginal rate will likely be higher than today's, conversion saves you money on the spread. If not, the upfront tax bill may not be recovered.
The longer the converted balance compounds tax-free before withdrawal, the more the conversion pays off. Conversions in your 30s or 40s carry the biggest leverage.
Designed so anyone can model their situation in under a minute, with or without a finance background.
If you expect higher rates in retirement, paying now and growing tax-free is a one-time arbitrage.
Every dollar of growth on the converted balance avoids ordinary income tax at withdrawal.
Roth IRAs have no required minimum distributions, so you keep control of when (or whether) to draw.
Heirs inherit a Roth tax-free for up to 10 years of continued growth — a powerful estate tool.
A Roth bucket lets you manage your taxable income in retirement to keep Medicare premiums and Social Security taxes low.
No surprise tax bills on withdrawals — what's in the Roth is yours to spend.
Everything you might ask before, during, or after using this tool.
When your current marginal tax rate is already higher than what you expect in retirement, when paying the conversion tax forces you to sell investments or drain savings, or when you're close to retirement with little time for tax-free growth to outrun the upfront tax bill.
Yes, provided your plan allows it (most do once you separate from service). Be aware the full conversion is taxable in one year, which can push you into a much higher bracket — many people do partial conversions across multiple years instead.
Potentially, yes. The conversion is added to your AGI, which can make more of your Social Security taxable and trigger higher Medicare Part B and D premiums (IRMAA) two years later. The calculator does not include those second-order effects.
Conversions follow the calendar year — they must be completed by December 31 to count for that tax year. Unlike contributions, there's no April 15 grace period for conversions.
No. Recharacterizations of conversions were eliminated by the Tax Cuts and Jobs Act starting in 2018. Once you convert, it's permanent.
A multi-year strategy where you convert a chunk each year, wait 5 tax years, and then withdraw the converted principal penalty-free before age 59½. It's a common early-retirement bridge to access 401(k) money without penalties.
Many planners say yes — the lower account value means a lower tax bill, and any recovery happens in the Roth where it's never taxed again. The math is straightforward, but be sure you have outside cash to pay the tax.
Each conversion has its own 5-year clock for penalty-free access to the principal before age 59½. After 59½, the 5-year rule still applies to earnings being tax-free, but penalties no longer apply to principal.
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The clearest cases for conversion are years where your income drops below normal — early retirement, a gap year, a sabbatical, or the window between leaving work and starting Social Security and required distributions. These "tax-rate valleys" are when conversions cost the least and pay off the most.
The clearest cases against conversion are peak-earning years where every additional dollar lands in a 32% or 35% bracket. Wait for the dip and convert then.
This is the single biggest lever. If you pay the conversion tax with cash from a brokerage or savings account, the entire converted amount lands in the Roth and compounds tax-free.
If you pay the tax from the IRA itself, you both shrink the Roth seed and (if under 59½) potentially trigger a 10% penalty on the portion withheld for taxes. The conversion still works, but the math gets noticeably weaker.
Converting your whole IRA in one year almost always pushes you into a higher bracket than necessary. Most planners recommend a multi-year ladder: convert only enough each year to fill your current bracket, then stop.
This is why the calculator above lets you slide the conversion amount. Find the point where your average rate stays below your expected retirement rate, and that's a reasonable annual conversion target.
A conversion increases AGI, which can: (1) make more of your Social Security benefit taxable, (2) trigger IRMAA — higher Medicare Part B/D premiums, two years later, (3) reduce ACA premium subsidies if you're under 65, and (4) phase out certain credits and deductions.
None of these are deal-breakers, but they're worth checking against your specific situation before doing a large conversion late in your working life.
Two short notes worth reading before you trust any number on this page.
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