Roth Conversion Calculator 2026
Tax cost, IRMAA impact, and breakeven analysis
Last updated: November 2025 · Brackets: IRS Rev. Proc. 2025-32 · IRMAA: CMS 2026 (simplified)
Conversion Details
Marginal federal rate auto-computed from 2026 brackets: 22.0%
0% for TX, FL, WA, NV, SD, TN, WY, AK, NH
Combined federal + state rate at withdrawal
Convert vs Do Not Convert (Net of Future Tax)
"Convert" = Roth balance grows tax-free. "Do not convert" = Traditional balance grows, taxed at 24% at withdrawal, plus the $13,500 you would have paid in tax stays invested at 7%.
Breakeven Analysis
Pay the conversion tax from outside funds
For a Roth conversion to be most efficient, pay the federal and state tax from a taxable account, not from the IRA itself. Using IRA dollars to pay tax means less money grows tax-free in the Roth and (if you are under 59½) triggers a 10% early withdrawal penalty on the diverted amount.
Understanding Roth Conversions in 2026
How a Roth Conversion Works
A Roth conversion moves money from a pre-tax Traditional IRA (or 401(k)) into a Roth IRA. The converted amount is added to your ordinary taxable income for the year and taxed at your marginal rate. Once inside the Roth, it grows tax-free, qualified withdrawals after age 59½ and 5 years are entirely tax-free, and there are no Required Minimum Distributions during your lifetime. The 2026 federal brackets (Rev. Proc. 2025-32) top out at 37% on income above $640,600 single / $768,700 MFJ.
The Pro-Rata Rule
If you have any pre-tax dollars across all your Traditional, SEP, or SIMPLE IRAs (not 401(k)s), every conversion is treated as a proportional mix of pre-tax and after-tax basis. Form 8606 tracks the basis. This is what trips up many backdoor Roth attempts when the person has a large rollover IRA from a former employer. Common workaround, roll the pre-tax IRA into a current 401(k) before doing the backdoor.
The 5-Year Rule for Conversions
Each conversion starts its own 5-year clock for the early-withdrawal penalty. Converted principal can be withdrawn penalty-free at any time, but only if that specific conversion has been in the Roth for at least 5 tax years (or you are over 59½). Earnings on conversions follow the standard Roth 5-year-and-59½ qualified-withdrawal rule.
IRMAA Impact (2-Year Lookback)
Medicare Part B and Part D premiums are surcharged based on your MAGI from 2 years prior. A 2026 conversion affects 2028 premiums. The first 2026 IRMAA bracket starts at roughly $106,000 MAGI single / $212,000 MFJ, with surcharges climbing through $500,000 / $750,000. Lump-sum conversions can push retirees through multiple brackets at once, partial annual conversions (laddering) sized to stay just under the next threshold preserve flexibility.
When Conversions Make the Most Sense
The best windows are low-income years where your current marginal rate is below your expected retirement rate. Classic examples, the gap years between retirement and age 73 (RMD start under SECURE 2.0), early-retirement before Social Security claims, a sabbatical or temporary unemployment, a year with a large business loss, or simply a year when the standard deduction soaks up most of your wage income. Also useful when you want to reduce a heir tax burden, the Roth passes income-tax-free to beneficiaries even if they still face the 10-year drawdown clock.
Frequently Asked Questions
When does a Roth conversion make sense?
When your current marginal rate is below your expected retirement rate, you can pay the conversion tax from outside funds, you do not need the converted money for at least 5 years, and you want to reduce future RMDs. Low-income gap years between retirement and Social Security are the classic window.
How does the pro-rata rule affect a Roth conversion?
If you hold any pre-tax money across all Traditional, SEP, or SIMPLE IRAs (not 401(k)s), the IRS treats every conversion as a proportional mix of pre-tax and after-tax. Form 8606 calculates basis. You cannot just convert the after-tax portion.
What is the 5-year rule for Roth conversions?
Each conversion has its own 5-year clock. To withdraw converted principal penalty-free before 59½, that conversion must have been in the Roth for at least 5 tax years. Earnings follow the standard Roth qualified-withdrawal rule.
Will a Roth conversion increase my Medicare premiums (IRMAA)?
Yes if it pushes MAGI above an IRMAA tier. Medicare uses a 2-year lookback, a 2026 conversion affects 2028 Part B and Part D premiums. The 2026 first tier starts around $106k single / $212k joint.
Do Roth conversions reduce future RMDs?
Yes. Roth IRAs have no lifetime RMDs. Every dollar converted before age 73 (the SECURE 2.0 RMD start age) reduces the Traditional balance subject to future RMDs.
Can I convert an inherited IRA to a Roth?
Generally no for a non-spouse inherited IRA. A surviving spouse can roll an inherited IRA into their own IRA and then convert. Non-spouse beneficiaries follow the SECURE Act 10-year rule.
What is a Roth conversion ladder?
Partial annual conversions sized to fill the next bracket without spilling over. After 5 years each conversion becomes accessible penalty-free under its own 5-year clock, a common FIRE strategy for accessing retirement money before 59½.