Free Roth IRA Conversion Calculator
Calculate the tax impact of converting your Traditional IRA to a Roth IRA. See conversion taxes, long-term savings, and find the optimal conversion strategy for your situation.
Roth IRA Conversion Calculator
Analyze the tax impact and benefits of converting Traditional IRA to Roth
Conversion Details
Key Considerations
Strategy: Convert in low-income years. Pay tax from non-retirement funds. Consider partial conversions over multiple years to manage tax brackets.
📚 Roth Conversion Mastery
💰 What is a Roth Conversion?
A Roth conversion moves money from a Traditional IRA (tax-deferred) to a Roth IRA (tax-free). You pay taxes now on the converted amount, but all future growth and withdrawals are tax-free.
Key benefit: Tax-free income in retirement, no RMDs, and tax-free inheritance for heirs.
📊 Tax Impact of Conversion
The converted amount is added to your taxable income for the year. Converting $50K in the 24% bracket costs $12K+ in federal taxes. State taxes add 0-13% more depending on location.
Strategy: Convert in low-income years (job loss, early retirement) to minimize tax hit.
🏛️ Traditional vs Roth IRA
Traditional: Tax deduction now, pay taxes on withdrawals, RMDs at 73. Roth: No deduction now, tax-free withdrawals, no RMDs ever.
Convert if: You expect higher taxes in retirement or want tax-free legacy for heirs.
💡 Partial Conversion Strategy
Don't convert everything at once! Partial conversions let you "fill up" your current tax bracket without jumping to the next. Convert just enough to stay in 24% bracket instead of pushing into 32%.
Example: Convert $30K/year for 5 years instead of $150K in one year.
📈 Long-term Tax Savings
Pay $12K in taxes now to convert $50K. If it grows to $150K over 20 years, you save $36K+ in retirement taxes (at 24% bracket). Plus, no RMDs means you control when and how much to withdraw.
Bonus: Roth IRAs don't count toward IRMAA (Medicare premium surcharges).
⚠️ Conversion Timing & Pitfalls
Best times: Early retirement (low income), market downturns (convert more shares), before age 73 (avoid RMDs). Avoid: High-income years, if you need the money within 5 years (penalty).
Pitfall: Can't recharacterize (undo) conversions anymore. Plan carefully!
How to Use This Roth Conversion Calculator
Enter IRA Balance & Tax Info
Input your Traditional IRA balance, current tax bracket, state, and conversion amount.
Set Retirement Tax Rate
Estimate your expected tax bracket in retirement to compare scenarios.
Analyze Conversion Impact
Review conversion taxes, break-even timeline, and long-term savings to decide.
Frequently Asked Questions
What is a Roth IRA conversion?
A Roth IRA conversion is the process of moving money from a Traditional IRA (or 401(k)) to a Roth IRA. You pay income taxes on the converted amount in the year of conversion, but all future growth and withdrawals are tax-free. Unlike contributions, there are no income limits for conversions, making it a popular strategy for high earners (backdoor Roth). Once converted, the money grows tax-free forever and has no Required Minimum Distributions (RMDs).
How much tax will I pay on a Roth conversion?
The converted amount is added to your taxable income for the year and taxed at your marginal rate. For example, converting $50,000 in the 24% federal bracket costs $12,000+ in federal taxes, plus state taxes (0-13% depending on state). If the conversion pushes you into a higher bracket, that portion is taxed at the higher rate. You can pay the tax from outside funds (recommended) or from the conversion itself (reduces the amount going to Roth).
Should I do a partial or full conversion?
Partial conversions are usually smarter. Convert just enough to "fill up" your current tax bracket without jumping to the next higher bracket. For example, if you're in the 24% bracket and have $40K of room before hitting 32%, convert $40K. You can repeat this strategy over multiple years. Full conversions make sense only if: (1) you're in a very low bracket now, (2) you expect much higher taxes in retirement, or (3) you have outside funds to pay the tax bill.
When is the best time to convert to a Roth IRA?
Best times: (1) Early retirement before Social Security/RMDs start (low income years), (2) Market downturns (convert more shares for same tax cost), (3) Before age 73 to avoid RMDs, (4) Years with deductions/losses that lower your taxable income. Avoid: High-income years, if you need the money within 5 years (10% penalty on earnings), or if you can't pay the tax from outside funds. Consider spreading conversions over multiple years to manage tax brackets.