Roth conversion planning
Roth Conversion Calculator: How Much Should You Convert in 2026?
A Roth conversion calculator answers one question: how much of your traditional IRA should you move to Roth this year? The math looks simple, pay tax now at a known rate instead of later at an unknown one, but the right answer depends on your tax bracket, your Medicare premiums two years out, and whether you buy health insurance on the ACA exchange. Get any of those wrong and the "optimal" conversion costs you money.
Updated September 2026 · 9 min read
The short version
- The core strategy is bracket-fill: convert enough each year to reach the top of your current federal tax bracket, without spilling into the next one.
- Timing matters more than amount: the best conversion years are usually the low-income "gap years" between retirement and RMDs at 73 or 75.
- Watch two cliffs: IRMAA starts at $109,000 single or $218,000 married filing jointly (2026 premiums, based on 2024 income), and the ACA subsidy cliff is back at 400% of the poverty level in 2026.
- Pay the tax from savings, not from the converted amount, or you trigger early-withdrawal penalties under 59 and a half.
What a Roth conversion calculator actually computes
Strip away the interface and every Roth conversion calculator is doing the same comparison: your marginal tax rate today versus your expected marginal rate later, when required minimum distributions, Social Security, and pensions stack up. If today's rate is lower, converting wins. If it's higher, you're prepaying tax for no reason.
Where calculators differ is what they include in "later." A simple one looks only at federal brackets. A good one also models state taxes, IRMAA surcharges, ACA subsidy effects, and the way RMDs grow as a percentage of your balance every year. The simple version can easily recommend a conversion that saves $4,000 in future income tax while costing $6,000 in lost ACA subsidies.
The framework below is the same one a thorough calculator uses. Walk through it once by hand and you'll understand exactly what the software is optimizing.
The bracket-fill method: how much to convert
Bracket-fill is the workhorse strategy. Each year, estimate your taxable income, then convert just enough traditional IRA money to bring your total taxable income up to the top of your current bracket. You pay tax at your current marginal rate and not a penny at the next rate up.
Here are the 2026 federal brackets that matter most for conversions (taxable income, after the standard deduction):
| Rate | Single | Married filing jointly |
|---|---|---|
| 12% | $12,401 to $50,400 | $24,801 to $100,800 |
| 22% | $50,401 to $105,700 | $100,801 to $211,400 |
| 24% | $105,701 to $201,775 | $211,401 to $403,550 |
For context, the 2026 standard deduction is $16,100 single and $32,200 married filing jointly. So a married couple with no other income can have about $133,000 of gross income (including conversions) and still have every converted dollar taxed at 12% or less.
A worked example
Take a married couple, both 63, retired, living off a taxable brokerage account. Their only income is $25,000 a year in dividends and interest. Their traditional IRAs total $900,000.
Their taxable income before any conversion is roughly $25,000 minus the $32,200 standard deduction, which is effectively zero. The top of the 12% bracket is $100,800 of taxable income, so they can convert about $100,000 this year and pay 12% on nearly all of it. Do that for 10 gap years and they've moved roughly $1 million into Roth at 12%, instead of letting RMDs force it out later at 22% or 24%. On $900,000, the rate difference alone is worth around $90,000 in lifetime tax.
The gap years: when to convert
Conversions are cheapest when your taxable income is lowest. For many retirees that means the "gap years": retired, not yet taking Social Security, and not yet subject to RMDs (age 73 or 75 under SECURE 2.0, depending on birth year). Living expenses come from taxable savings, which generate little taxable income, so there's enormous room inside the lower brackets.
The window closes in stages. Social Security benefits add taxable income (up to 85% of benefits are taxable). At 63, your income starts counting toward IRMAA two years later. At 73 or 75, RMDs begin and the gap years are over. Someone retiring at 60 with an RMD age of 75 has a 15-year window; someone retiring at 68 has five. The shorter the window, the more aggressive each year's conversion needs to be, and the more carefully you have to watch the cliffs below.
IRMAA: the Medicare cliff in your math
Once you turn 65, Medicare looks at your modified adjusted gross income from two years prior and adds a surcharge to your Part B and Part D premiums if you're over the thresholds. For 2026 premiums (based on 2024 income), the tiers are:
| 2024 MAGI, single | 2024 MAGI, joint | Monthly Part B |
|---|---|---|
| $109,000 or less | $218,000 or less | $202.90 (no surcharge) |
| $109,001 to $137,000 | $218,001 to $274,000 | $284.10 |
| $137,001 to $171,000 | $274,001 to $342,000 | $405.80 |
| $171,001 to $205,000 | $342,001 to $410,000 | $527.50 |
| Over $205,000 | Over $410,000 | $649.20 and up |
These are cliffs, not phase-ins: one dollar over $109,000 costs a single filer about $975 a year in extra Part B premiums alone, plus the Part D surcharge. And because of the two-year lookback, a big conversion at 63 sets your premiums at 65.
The practical rule: from age 63 on, treat each IRMAA threshold as a hard ceiling for your conversion amount, unless the lifetime tax savings clearly outweigh two years of surcharges. Before 63, IRMAA doesn't constrain you, which is one more reason the early gap years are the most valuable conversion years you'll ever have.
ACA subsidies: the other cliff
If you buy health insurance on the ACA exchange before Medicare at 65, your premium tax credit depends on your income, and in 2026 the hard cliff at 400% of the federal poverty level is back. Earn one dollar over the limit and you lose the entire subsidy, which can be $10,000 to $30,000 a year for a couple in their early 60s.
This creates a genuine tension: the gap years are your best conversion years, but they're also the years you're most likely on ACA insurance. A $60,000 conversion that saves $7,000 in lifetime income tax but costs $12,000 in lost subsidies this year is a bad trade. The fix is sequencing: convert aggressively in years you're on employer coverage or COBRA, convert modestly (staying under the cliff) in ACA years, or bunch conversions into alternating years, staying under the cliff one year and converting big the next.
When converting is a mistake
Conversions aren't always smart. Skip them (or pause them) when:
- You're still in your peak earning years. Converting at 32% or 35% today to avoid 22% later is backwards. The gap years are the opportunity, not your 50s.
- You'll give the money to charity. Dollars you plan to donate via qualified charitable distributions after 70 and a half were never going to be taxed anyway. Convert the money your heirs will actually inherit.
- Your heirs are in a lower bracket than you. If your kids earn modest incomes, inheriting a traditional IRA (emptied over 10 years under current law) may cost less in total tax than you paying 24% to convert now.
- You're moving to a no-income-tax state. Actually this one argues for waiting: if you'll retire in Texas or Florida, don't convert while you're still paying California or New York state tax on the conversion.
- You can't pay the tax from savings. Raiding the IRA to pay the conversion tax, especially before 59 and a half, turns a tax play into a penalty.
Model your conversions year by year
NestCalc's free calculator runs 1,000 market scenarios with your brackets, RMDs, IRMAA tiers, and ACA subsidies modeled every year, and its Roth conversion optimizer finds the schedule that maximizes your after-tax spending.
Run the free calculator →Frequently asked questions
How much should I convert to Roth each year?
A common rule is bracket-fill: convert up to the top of your current federal tax bracket without spilling into the next one. In 2026 that means up to $50,400 of taxable income single or $100,800 married filing jointly to stay inside the 12% bracket. Stop sooner if a conversion would push you over an IRMAA threshold or the ACA subsidy cliff.
Do Roth conversions affect Medicare premiums (IRMAA)?
Yes. Converted amounts count toward the modified adjusted gross income that sets your Medicare Part B and Part D premiums two years later. For 2026 premiums the first IRMAA tier starts above $109,000 single or $218,000 married filing jointly, based on 2024 income. A big conversion at 63 raises your premiums at 65.
Can I do Roth conversions while on ACA health insurance?
You can, but conversions raise the income that determines your premium tax credit. With the 400% federal poverty level cliff back in 2026, one dollar over the limit can erase the whole subsidy. Many early retirees convert modestly in ACA years and aggressively in years on COBRA or employer coverage.
Is there a limit on how much I can convert per year?
No. There is no annual cap and no income limit on Roth conversions, unlike Roth contributions. The practical limit is your tax bracket, since every converted dollar is ordinary income in the year you convert it.
Should I pay the conversion tax from the IRA or from savings?
From savings, whenever possible. If you're under 59 and a half and the tax is withheld from the converted amount, the withheld portion counts as an early distribution: income tax plus a 10% penalty. Paying from taxable savings also leaves more money growing tax-free inside the Roth.
What if I convert and the market crashes right after?
You can't undo a Roth conversion (recharacterization was eliminated in 2018), so a crash right after means you paid tax on value that no longer exists. Converting in smaller tranches through the year spreads that timing risk, and a crash can actually be a good moment to convert more, since you're moving depressed shares that will recover tax-free.