Somewhere in a traditional IRA or 401(k) near you, there’s a silent partner who has never contributed a dollar — but is waiting patiently to collect a significant share of your retirement savings. That partner is the IRS.
A Roth conversion strategy is how you buy out that partnership — on your terms, at a tax rate you control, before Required Minimum Distributions force your hand at age 73.
The Problem With Pre-Tax Accounts
Every dollar in a traditional IRA or 401(k) has never been taxed. That’s by design — you got a tax deduction when you contributed, and the money has grown tax-deferred. But the IRS has always maintained a claim on it. When you withdraw (or are forced to withdraw via RMDs), every dollar comes out as ordinary income at your marginal tax rate.
For many retirees, this creates an accelerating problem:
- At age 73, RMDs begin — you must withdraw a certain amount each year whether you need it or not
- Those withdrawals increase your taxable income, pushing you into higher brackets
- Higher income makes more of your Social Security taxable (up to 85%)
- Higher income can trigger Medicare IRMAA surcharges of $81 to $487/month per person
- Large IRA balances pass to heirs with a tax bill — under the SECURE Act, non-spouse beneficiaries must withdraw everything within 10 years
What a Roth Conversion Does
A Roth conversion moves money from a pre-tax account into a Roth IRA. You pay income tax on the converted amount in the year of conversion — but after that, the money grows completely tax-free, withdrawals are tax-free, and there are no Required Minimum Distributions on Roth IRA assets.
When Roth Conversions Make the Most Sense
The window between retirement and RMDs
The optimal conversion window is often the years between retirement and age 73 — when your earned income has stopped (or reduced) but RMDs haven’t started yet. Your taxable income may be at its lowest during this period, meaning you’re converting at your lowest lifetime tax rate.
When your IRA balance is growing faster than you’ll spend it
If your IRA is large and growing, future RMDs could be significantly larger than you need for living expenses — and you’ll pay taxes on all of it. Converting now at a lower rate locks in a smaller tax bill on money that would otherwise generate larger forced withdrawals later.
Before Social Security begins
If you’re delaying Social Security to maximize your benefit, the years before you start receiving benefits may offer a lower-income window ideal for Roth conversions.
The IRMAA Trade-Off
Large Roth conversions increase your taxable income in the conversion year — which can trigger Medicare IRMAA surcharges two years later (the IRMAA lookback is your tax return from two years prior). This doesn’t mean don’t convert — it means conversions need to be sized carefully against IRMAA brackets.
In 2026, the first IRMAA threshold is $109,000 for single filers and $218,000 for married filing jointly. Converting $50,000 that keeps you just below these thresholds is very different from converting $200,000 that pushes you into the fourth bracket.
How Much to Convert Each Year
The optimal Roth conversion amount each year is typically determined by filling your current tax bracket to its ceiling — without crossing into the next bracket or an IRMAA tier. For a married couple in the 22% bracket in 2026, this might mean converting enough to bring taxable income to $211,400 before the 24% bracket begins.
Executed over 5–10 years, this approach can dramatically reduce your traditional IRA balance before RMDs begin — lowering your future forced distributions, reducing Social Security taxation, and minimizing IRMAA exposure for the rest of your life.
The Legacy Benefit
Under the SECURE Act, most non-spouse beneficiaries must fully distribute an inherited IRA within 10 years — and traditional IRA distributions are taxable income. A $500,000 inherited traditional IRA distributed over 10 years to a child in their peak earning years could easily cost $150,000 to $200,000 in additional taxes. The same $500,000 in a Roth IRA passes income-tax-free.
Roth conversions are one of the most powerful gifts you can give your family — not just a tax strategy for yourself.