Move money from a traditional 401(k) or IRA to a Roth, and pay the tax now instead of later.
Figures on this page are for the 2026 tax year. Rules that are fixed in law rather than indexed — the Social Security thresholds, for instance — are noted where they come up.
A Roth conversion is one transaction with one consequence: you move money out of a traditional 401(k) or IRA, into a Roth account, and you pay ordinary income tax on the amount you moved — this year.
That's it. Nothing is sold, nothing leaves your control, and the money stays invested the whole time. What changes is the tax status of that money for the rest of its life.
Money in a traditional 401(k) or IRA has never been taxed. You got a deduction when it went in, it's grown untaxed since, and the IRS is waiting at the other end. Every dollar you eventually withdraw is ordinary income.
Money in a Roth has already been taxed. Nothing you withdraw later is taxable — not the principal, not decades of growth. And unlike a traditional account, a Roth IRA has no required minimum distributions during your lifetime, so nobody forces you to take money out on a schedule that suits the Treasury rather than you.
A conversion moves a chunk of money from the first category to the second, and the price is paying the tax bill early.
Everything else — brackets, Medicare surcharges, Social Security taxation — is machinery for working out what "your tax rate now" honestly means. It's rarely the number you'd guess. That's the subject of why your bracket isn't what a conversion costs.
There's usually a window between the day the paycheque stops and the day Social Security and required minimum distributions start. Income drops, sometimes to almost nothing. The brackets don't care why your income is low — they just charge less.
For a married couple in 2026, taxable income up to $24,800 is taxed at 10%, and up to $100,800 at 12%. If your income during that window is $30,000, there is a lot of room in the 12% bracket that you're simply not using. Convert into it and you pay 12% on money that might otherwise come out at 22% or 24% later.
Leave that room unused and it's gone. Bracket space doesn't roll over.
The pressure comes from the other end. Required minimum distributions start at 73 if you were born between 1951 and 1959, and 75 if you were born in 1960 or later. The first year's RMD is your balance divided by 26.5 — roughly 3.8% — and the divisor shrinks every year, so the forced percentage keeps climbing. A large traditional balance eventually generates a large mandatory income whether you want it or not.
Converting before then permanently reduces the base those distributions are calculated from. That's the real argument for acting in the low-income window: not that Roth accounts are magic, but that the alternative is a bigger forced withdrawal at a worse rate.
A conversion is not a contribution. There is no income limit and no annual cap. You can convert $200,000 in a year if you want to, and you can do it at any age. It has nothing to do with the annual IRA contribution limits.
A conversion cannot be undone. This is the one that matters. Recharacterization — the old escape hatch that let you reverse a conversion — was eliminated by the Tax Cuts and Jobs Act in 2018. Once the money moves, the tax is owed for that year, and no amount of regret in February changes it. That's why sizing a conversion carefully is worth more effort than it sounds like it should be.
An RMD can't be converted. Once you're at RMD age, you must take the required distribution first. It's taxable income, and only what's left over can be converted.
If you take away one practical rule, take this one.
You can pay the conversion tax either by withholding it from the money you're converting, or out of a taxable brokerage or savings account. Withholding is easier. It's also a lot worse.
Say you convert $100,000 in the 22% bracket. Pay from outside, and $100,000 lands in the Roth and compounds tax-free forever. Withhold instead, and only $78,000 arrives — you've converted $100,000 but permanently shrunk the tax-free account by $22,000 and everything it would have earned.
Under 59½ it's worse still: the withheld portion counts as an early distribution and picks up a 10% penalty on top.
This is why the money you hold outside retirement accounts is one of the biggest factors in whether a conversion is worth doing at all. The calculator asks for it and treats it as a real constraint — if your taxable balance can't cover the plan, it says so rather than quietly assuming money that isn't there.
There are two, and they get confused constantly.
One governs earnings: your first Roth IRA has to have been open five years before earnings come out tax-free. One governs converted principal: each conversion starts its own five-year clock before that principal can be withdrawn penalty-free if you're under 59½.
Neither is usually a problem for someone converting in their sixties with no intention of touching the money. But if there's a chance you'll need the converted money within five years, that's a reason to convert less.
The mechanics above are the easy part. The hard part is that the cost of a conversion is almost never your tax bracket, and the gap between the two is where the actual decisions live.