Roth IRA Conversion Tax Impact Calculator
After deductions (Form 1040, line 15)
Filing status
Your expected marginal bracket in retirement
Share of yearly growth lost to tax on dividends and gains
Pay the conversion tax from
Tax on converting $50,000 in 2026
$13,500
$11,000 federal and $2,500 state, an effective 27.0% on the converted amount. It lifts your taxable income to $170,000, all in the 22% bracket; the 22% bracket ends at $211,400 of taxable income.
After 20 years
Converting leaves $9,351 more
| Convert: Roth IRA, tax-free | $193,484 |
|---|---|
| Keep: traditional IRA after 27% tax, plus the tax money invested | $184,133 |
Converting wins if your combined tax rate on withdrawals would be above 22.2%; you entered 27.0%. Paying the tax from outside savings helps, because it moves more money into the tax-free account.
Assumes a deductible traditional IRA (no after-tax basis). Each conversion has its own five-year clock before converted money can be withdrawn penalty-free under 59½. A conversion can also raise Medicare premiums (IRMAA) two years later and reduce income-based credits. Roth IRAs have no required minimum distributions.
Estimate the federal and state tax on converting a traditional IRA to a Roth IRA in 2026, which bracket the conversion reaches, and whether converting leaves you more after tax by the time you withdraw, depending on your tax rate then and how you pay the conversion tax.
Formula
Worked Example
The whole $50,000 lands in the 22% bracket, which runs to $211,400 of taxable income for joint filers in 2026. Paying the tax from outside savings keeps the full $50,000 growing tax-free, and the Roth comes out ahead as long as withdrawals would otherwise be taxed at more than 22.2% combined.
Frequently Asked Questions
When is a Roth conversion worth it?
When you can pay tax now at a lower rate than you expect to pay on withdrawals later, and can pay that tax from money outside the IRA. Low-income years, such as early retirement before Social Security and required distributions begin, are common windows for converting up to the top of a bracket.
What is the five-year rule for Roth conversions?
Each conversion starts its own five-year clock. If you are under 59½ and withdraw converted money before that conversion is five years old, the 10% early-withdrawal penalty applies to it. After 59½, converted amounts can be withdrawn without penalty.
Can I undo a Roth conversion?
No. Recharacterizing a conversion back to a traditional IRA has not been allowed since 2018, so the tax is due even if the market falls after you convert. Converting in pieces over several years spreads that risk and keeps each year's income in a lower bracket.
Common Mistakes
- !Forgetting the pro-rata rule: if you also hold pre-tax money in any traditional, SEP or SIMPLE IRA, every conversion is taxed in proportion to all of it.
- !Paying the tax out of the conversion itself, which shrinks the Roth and, under 59½, can add a 10% penalty.
- !Ignoring side effects of the higher income: Medicare IRMAA surcharges two years later and lost income-based credits.