Roth Conversion Tax Calculator
Estimate the income tax cost of converting a traditional IRA or 401(k) to a Roth, and how much lands in the Roth if tax is paid from the account.
How it works
Tax = converted amount × marginal rate · Roth balance = amount − (tax if paid from account)
A Roth conversion moves pre-tax retirement money into a Roth, where it grows and is withdrawn tax-free — but the converted amount is added to your taxable income this year and taxed at your marginal rate. Paying that tax with outside cash lets the entire balance keep compounding tax-free, which is why it usually beats paying the tax out of the account. Large conversions can push you into a higher bracket, so many people convert in smaller annual slices.
Worked example
Converting $50,000 at a 24% marginal rate creates a $12,000 tax bill. Pay it from a checking account and all $50,000 stays in the Roth; pay it from the balance instead and only $38,000 makes it in.
Frequently asked questions
Why is paying the tax from outside cash better?
Every dollar left inside the Roth compounds tax-free for life. If you skim the tax from the converted balance, that money never gets the Roth treatment, permanently shrinking the tax-advantaged pot.
Could a conversion push me into a higher bracket?
Yes — the converted amount stacks on top of your other income, so a big conversion can spill into a higher marginal rate. Converting a partial amount each year, up to the top of your current bracket, keeps the average tax rate down.
Is there a penalty on a conversion?
The conversion itself is not an early-withdrawal, so the 10% penalty does not apply to the amount converted. But each conversion starts its own 5-year clock before those dollars can be withdrawn penalty-free if you are under 59½.
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Educational estimate only, using simplified federal rules — it ignores state tax, credits, phase-outs and your full situation. Not tax, legal or financial advice; confirm with a professional.