Analyze the tax cost of converting a Traditional IRA to Roth, estimate the break-even point, and compare projected after-tax wealth under current federal rules.
The Roth IRA Conversion Calculator helps you compare paying tax now to convert Traditional IRA money into a Roth IRA versus leaving those dollars in a Traditional IRA and paying tax later. A Roth conversion usually creates immediate ordinary income, but in return the converted money can grow inside the Roth and qualified withdrawals can be tax-free.
The tradeoff depends on your current tax rate, expected retirement tax rate, time horizon, and whether you pay the conversion tax from outside savings or from the IRA itself. Paying tax from outside funds often improves the Roth case because more principal stays inside the account.
Enter the balance, conversion amount, tax rates, return assumption, and time horizon to see the current tax cost, the estimated break-even year, and the projected after-tax comparison. This page is a planning worksheet rather than a full bracket-filling or multi-year tax model.
A Roth conversion can be beneficial, neutral, or expensive depending on timing and tax assumptions. This page helps you see whether the conversion math is working for you before you decide how much to convert and when.
Tax Cost = Conversion Amount × Current Tax Rate Roth Path: (Conversion Amount − Tax if paid from IRA) × (1 + Return)^Years Traditional Path: Conversion Amount × (1 + Return)^Years × (1 − Retirement Tax Rate) Break-Even = First year when Roth after-tax value exceeds Traditional after-tax value under the page assumptions
Result: Tax cost: $12,000 | Break-even: year 5 | Roth advantage at year 20: $8,361
Converting $50,000 at a 24% tax rate creates a $12,000 tax cost. If that tax is paid from outside funds, the full $50,000 stays in the Roth and grows to about $193,484 over 20 years at 7%. In the comparison path, the Traditional IRA grows to the same pretax amount but is reduced by the 22% retirement tax assumption, while the outside tax money is modeled as a taxable side investment. Under those assumptions, the Roth path pulls ahead in about year 5 and ends roughly $8,361 ahead by year 20.
Every Roth conversion has a break-even point — the year when tax-free growth inside the Roth catches up to the tax paid up front. The longer the time horizon, the stronger the case for paying tax now to shelter future growth.
Many households convert gradually rather than all at once. The idea is to convert only enough each year to stay inside a chosen tax bracket instead of jumping into a higher one. This page does not calculate bracket-filling automatically, but it is useful for checking the rough tradeoff at one conversion size.
Paying the tax from outside funds is often the cleaner comparison because it keeps the full conversion amount inside the Roth. When tax is paid from the IRA itself, less money gets converted and the Roth starts with a smaller base.
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This page compares two paths for the entered conversion amount. In the Roth path, the conversion amount is taxed now and then grows at the entered return rate for the selected number of years. In the Traditional path, the amount stays in the Traditional IRA and is reduced by the retirement tax rate only at the end of the projection. If you choose to pay the conversion tax from outside funds, the page also grows that outside tax money as a separate taxable side investment using the entered capital-gains-rate assumption.
The worksheet does not model state tax, future bracket changes, IRMAA directly, multi-year bracket-filling strategies, or required minimum distributions in detail. It is best used as a first-pass comparison rather than a full tax plan.
It is often most attractive when your current tax rate is relatively low, you have time for tax-free growth, and you can pay the conversion tax from outside savings rather than from the IRA itself.
Yes. Partial conversions are common. Many people convert only enough each year to stay within a chosen tax bracket rather than converting the entire balance at once.
Each Roth conversion has its own 5-year clock for certain withdrawal rules. The tax-free treatment of qualified Roth distributions and the penalty rules for early access depend on age, account history, and when the conversion occurred.
Outside funds are often better because they keep more money inside the Roth. Paying tax from the IRA itself reduces the converted principal and can trigger additional issues if you are below the age threshold for penalty-free access.
Yes. The conversion amount increases MAGI and can push income into a higher IRMAA band for Medicare Part B and Part D. For 2026 premiums, IRMAA starts above $109,000 for single filers and above $218,000 for married filing jointly, using a two-year lookback. This page does not model IRMAA directly, so it is worth checking separately if you are close to those thresholds.
No. Roth conversions are generally irrevocable under current rules, so the timing and size of the conversion should be planned before execution.