What Is a Roth Conversion?
A Roth conversion means moving funds from a traditional IRA or 401(k) into a Roth account. You pay taxes now, and future withdrawals can be tax-free.
When It Makes Sense
Consider a Roth conversion when your current tax rate is lower than your expected future rate. It also works well in years when income is temporarily reduced.
Tax Impact of the Conversion
The converted amount is taxed as ordinary income in the year of conversion. Use our calculators to estimate the extra tax owed and compare it with future tax-free growth.
Timing and Partial Conversions
You don’t have to convert everything at once. Partial conversions can spread the tax impact across multiple years and avoid pushing you into a much higher bracket.
Long-Term Retirement Benefits
Roth accounts do not require RMDs and can provide more flexibility in retirement. Evaluate your overall retirement plan before choosing a conversion strategy.