Roth Conversion Calculator
Estimate the tax owed on converting traditional retirement funds to a Roth and whether converting now looks favorable versus paying tax later.
How it works
Tax owed now = amount converted × current marginal rate · Tax later = amount × expected retirement rate · Converting is favorable on rates when current rate < expected retirement rate
A Roth conversion moves money from a tax-deferred traditional account into a Roth, where future growth and withdrawals are tax-free — but you pay ordinary income tax on the converted amount today. The core question is a rate comparison: if you expect a higher tax rate in retirement than you face now, paying tax at today’s lower rate wins. This simplified tool compares the tax at each rate on the same amount; it does not model the extra income pushing you into higher brackets, future growth, or the value of paying the tax from outside the account.
Worked example
Converting $50,000 at a 24% current marginal rate costs $12,000 in tax now. If you expect a 22% rate in retirement, the tax later would be $11,000 — so on rates alone, converting is not favorable here, since your current rate (24%) is above your expected retirement rate (22%).
Frequently asked questions
When does a Roth conversion make sense?
Generally when your current tax rate is lower than the rate you expect in retirement — for example in a low-income year, early retirement before RMDs, or before tax rates are scheduled to rise. Paying tax now locks in the lower rate.
What does this calculator leave out?
Plenty: the conversion adds to this year’s income and can push part of it into higher brackets, affect Medicare premiums, and the real benefit compounds through tax-free growth. Paying the tax from outside the account also boosts the case. Treat this as a first-pass rate check.
Are converted funds locked up?
Each conversion has its own five-year clock before the converted amount can be withdrawn penalty-free if you are under 59½. Roth conversions also cannot be undone, so model the tax carefully before converting.
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Educational estimate only, not tax advice. Contribution limits, catch-up amounts and tax rules change with each year and depend on your income and plan — confirm current figures with a qualified tax professional.