Christian BrinkleyLicensed agent, NC Life & Health · Updated October 5, 2026 · 3 min read
A Roth conversion means moving money from a traditional IRA or 401(k) into a Roth IRA. You pay income tax on what you move this year. In exchange, that money can grow and come out tax free later, and it's not subject to required minimum distributions while you're alive. Whether that trade makes sense depends a lot on timing.
How it's taxed
Whatever you convert gets added to your taxable income for the year, just like a paycheck. Convert $30,000 and you're taxed as if you earned $30,000 more. There's no income limit on who can convert, and you don't have to convert everything at once. Plenty of people do it in smaller pieces over several years.
One rule to respect: since 2018, a conversion can't be undone. Once it's done, the tax is owed.
Why people look at it
The usual reasons:
- They expect their tax rate to be the same or higher later, so paying now looks cheaper.
- They want to shrink future RMDs, which are taxed as income every year.
- They want to leave money to family that can generally come out tax free.
- They're in the gap years: retired, but before Social Security and RMDs start, when income can be unusually low.
Those gap years are the reason I built the Roth conversion window tool. It shows how many low-income years you might have before RMDs begin.
The catches
This is where it gets real. A conversion raises your income, and income is connected to other things:
- Medicare premiums. Medicare sets your Part B and Part D premiums using your income from two years earlier. A large conversion at 63 or later can mean higher premiums at 65 and beyond. That's IRMAA, and I explain it in Will Medicare cost me more because of my income?
- Social Security taxes. If you're already collecting, the extra income can make more of your benefit taxable. See Is Social Security taxable?
- Health insurance before 65. If you buy coverage on the Marketplace, a higher income can shrink your premium tax credit.
- Paying the tax. Using money from the IRA itself to pay the tax means less ends up in the Roth. People often plan to pay it from savings instead.
The five-year rules
There are two separate five-year clocks, and they trip people up:
- Each conversion has its own five-year clock. If you're under 59½ and take out converted money before five years pass, you can owe a 10% penalty on that amount.
- To take out earnings tax free, you need to be 59½ or older and have had a Roth IRA for at least five years, counting from January 1 of the year you first funded one.
If you're past 59½ and already have an older Roth IRA, these rules matter much less. If you're younger, they matter a lot.
So, is it worth it?
Honestly, it depends on your tax bracket now versus later, your Medicare timing, and when you plan to start Social Security. It's a numbers question for your specific situation, not a rule of thumb. Run it with a tax professional before you move anything, and look at Medicare brackets alongside tax brackets, because the premium jump can catch people off guard.
Questions people ask me about this
Can I convert just part of my IRA?
Yes. You choose the amount. Converting in smaller pieces over several years is a common way to keep each year's income in a lower bracket.
Will a conversion raise my Medicare premiums?
It can. Medicare uses your income from two years earlier, so a conversion at 63 can affect what you pay at 65. If your income crosses an IRMAA bracket, both Part B and Part D premiums go up for that year.
Does a Roth IRA have required minimum distributions?
Not for the original owner. People who inherit a Roth IRA generally do have to empty it within a set window, though withdrawals are usually tax free.
Should I do a conversion?
I can't tell you that, and a quiz can't either. It depends on your full tax picture. I'm glad to show you how it lines up with Medicare costs, and I'll point you to the advisor I work with for planning.