Roth IRA Conversion Calculator 2026

This is the detail that decides whether a conversion works, and it is easy to miss.

If you convert $50,000 and pay the $11,000 tax bill out of the converted money, only $39,000 actually reaches the Roth. You have moved less than you converted, and if you are under 59½ the withheld amount is treated as a distribution — triggering the 10% early withdrawal penalty on top.

Paying the tax from separate savings moves the full $50,000 into the Roth. In effect you are getting extra money into a tax-free wrapper beyond the annual contribution limit, which is the real structural benefit.

The practical rule: if you cannot pay the conversion tax from outside funds, the conversion is usually not worth doing. That single constraint rules it out for many people who would otherwise benefit.

A low-income year —

unemployment, a career break, a sabbatical, or the first year of a business making losses. Your rate is temporarily below where it will settle.

Early retirement before Social Security —

the window between finishing work and claiming benefits often has unusually low taxable income, and it is the single most common planned conversion opportunity.

Expecting higher rates later —

either because your own income will rise, or because you believe statutory rates will.

Estate planning —

inherited traditional IRAs generally must be emptied within ten years and are taxed to the beneficiary. A Roth passes the same balance tax-free, which matters if heirs are high earners.

Avoiding required minimum distributions —

traditional accounts force taxable withdrawals from a set age; Roth IRAs do not, giving control over taxable income that affects Medicare premiums and Social Security taxation.

When NOT to convert —

if you must pay the tax from the converted funds, if you are near a subsidy or Medicare premium threshold, or if you expect a materially lower rate in retirement.

Conversions carry their own waiting period, separate from the one governing Roth earnings, and confusing the two causes avoidable penalties.

Each conversion has a five-year clock before the converted principal can be withdrawn penalty-free if you are under 59½. Each conversion starts its own clock, so a series of annual conversions creates a series of separate five-year periods.

A different five-year rule governs the earnings on a Roth IRA: earnings are only tax-free if the account has been open five years and you are over 59½ or meet another qualifying condition.

Over 59½, the conversion five-year rule ceases to matter for penalties. Under it, converting money you may need within five years is a genuine trap — the tax was paid and a penalty still applies.

If you hold any non-deductible contributions in a traditional IRA, you cannot choose to convert only the after-tax portion. The IRS treats all of your traditional IRA balances as a single pool, and every conversion is proportionally taxable.

Someone with $95,000 of pre-tax IRA money and $5,000 of after-tax basis converting $10,000 does not convert the after-tax $5,000. They convert 95% taxable and 5% tax-free, regardless of which account the money physically left.

This is the mechanism that complicates the backdoor Roth strategy for anyone with existing traditional IRA balances. Rolling pre-tax IRA money into an employer 401(k) first — where the pro-rata rule does not reach — is the usual workaround, though not every plan accepts incoming rollovers.