Retirement
What a Roth conversion costs in 2026
A Roth conversion moves money from a pre-tax traditional IRA or 401(k) into a Roth, where it grows and is withdrawn tax-free. The price of admission is that the converted amount is added to your taxable income this year. Because it stacks on top of your existing income, a large conversion can spill into higher brackets — so the effective rate on the conversion matters more than your headline bracket.
Why "filling up a bracket" is the core idea
Smart conversions are usually sized to fill a target bracket without overflowing into the next one. In a low-income year — early retirement before Social Security and RMDs begin — you might convert just enough to reach the top of the 12% or 22% band, locking in a low rate on money that would otherwise be taxed at a higher rate later.
Watch the second-order effects
A conversion raises your modified AGI, which can trigger the 3.8% Net Investment Income Tax on other income, increase Medicare IRMAA premiums two years later, and affect ACA subsidies. The conversion amount itself is not investment income subject to NIIT, but it can push your other income over the threshold — model that with the NIIT calculator.
Pay the tax from outside funds, not the IRA, so the full balance keeps growing in Roth. To see where each dollar of conversion lands, use the marginal tax rate calculator and the effective tax rate calculator. For high earners locked out of direct Roth contributions, compare with the backdoor Roth IRA and mega backdoor Roth.
Questions
Roth Conversion Tax Calculator 2026 FAQ
How is a Roth conversion taxed?
The pre-tax amount you convert is added to your ordinary taxable income for the year and taxed at your regular rates. It stacks on top of your other income, so part of a large conversion can be taxed in higher brackets. There is no early-withdrawal penalty on a conversion itself, but a five-year clock applies before you can withdraw converted amounts penalty-free.
How much should I convert?
A common approach is to convert just enough to "fill" a target tax bracket without spilling into the next one, ideally in a low-income year. This calculator shows the effective rate on a given conversion so you can size it to your bracket. There is no annual dollar limit on conversions.
Should I pay the tax from the IRA or outside money?
Whenever possible, pay the conversion tax from non-retirement (outside) funds. That lets the entire converted balance keep compounding inside the Roth. Using IRA money to pay the tax shrinks the amount that benefits from tax-free growth and, if you are under 59½, can add a penalty.
Does a Roth conversion affect Medicare or NIIT?
Indirectly. The conversion raises your modified AGI, which can increase Medicare IRMAA surcharges two years later and push other income over the 3.8% Net Investment Income Tax thresholds ($200,000 single / $250,000 married). The conversion amount is not itself net investment income, but it can elevate your MAGI.
- Sources: IRS Rev. Proc. 2025-32 (2026 brackets) · IRS Publication 590-A (Roth conversions) · IRC §408A · IRS Topic No. 309.
- 🔄 Last updated June 27, 2026 · Tax year 2026
Disclaimer: Educational estimate, not tax or financial advice; the operator is not a CPA or financial adviser. It models federal income tax only — state tax, NIIT, IRMAA and the five-year rule may apply. Consult a professional before converting.
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