Roth Conversion 2026: Tax, Rules and Calculator
Roth Conversion 2026: How It Is Taxed, the Rules and a Roth Conversion Tax Calculator
How the converted amount is taxed, the 2026 brackets, Form 8606 and the pro-rata rule, the five-year rules, side effects on Medicare and benefits, and a calculator.
A Roth conversion moves money from a pre-tax traditional IRA (or similar account) into a Roth IRA. The converted pre-tax amount is added to your taxable income for that year and taxed at ordinary rates, which for 2026 run from 10% to 37%. There is no income limit on conversions, but since 2018 a conversion cannot be undone. If you also hold other pre-tax IRA money, the taxable share is figured across all of it using Form 8606, and a separate five-year period applies to converted amounts withdrawn before age 59½. The calculator below estimates the added federal tax using the 2026 brackets.
Search interest in Roth IRAs and 401(k)s stays high in the United States, and "Roth conversion" is one of the questions that follows: what does it cost in tax, what are the rules, and can it be reversed? This guide answers those questions with the IRS's own framework, shows the 2026 tax brackets that drive the cost, and includes a calculator so you can test conversion sizes against your own taxable income. It describes how conversions work; it does not tell you whether to do one.
1. What a Roth Conversion Is
A Roth conversion transfers pre-tax retirement money, most often from a traditional IRA, into a Roth IRA. Contributions to a Roth IRA are made with after-tax dollars, and qualified withdrawals are tax-free, so the converted pre-tax amount is taxed in the year of the conversion. Unlike Roth contributions, conversions are not limited by your income or by the annual contribution limit. Our guide to 401(k) and IRA contribution limits covers the contribution side.
2. How the Conversion Is Taxed
The IRS states that a conversion to a Roth IRA results in taxation of any untaxed amounts in the traditional IRA. Several rules shape the bill:
- Ordinary income. The taxable amount is added to the year's income and taxed at your ordinary rates, not at capital gains rates.
- Form 8606. Conversions are reported on Form 8606. The IRS lists converting an amount from a traditional IRA to a Roth IRA as a reason you must file it.
- Mixed pre-tax and after-tax money. If your traditional IRAs include nondeductible (after-tax) contributions, the taxable share is not chosen by you. It is figured on Form 8606 across your traditional, SEP and SIMPLE IRA balances. Our backdoor Roth and pro-rata guide walks through that rule.
- No recharacterization. The IRS states that a conversion made on or after January 1, 2018 cannot be recharacterized, which means it cannot be undone later if markets fall or the tax bill is larger than expected.
- The 10% additional tax. Taking earnings out of a Roth IRA, or converted amounts within their five-year period, before age 59½ can trigger a 10% additional tax unless an exception applies (see section 5).
3. 2026 Federal Tax Brackets
Because a conversion stacks on top of your other income, the brackets decide the cost. These are the 2026 thresholds from the IRS's Rev. Proc. 2025-32 as summarized by KPMG. Amounts are taxable income, after deductions; the standard deduction is $16,100 for single filers and $32,200 for married filing jointly.
| Rate | Single: taxable income over | Married filing jointly: over |
|---|---|---|
| 10% | $0 | $0 |
| 12% | $12,400 | $24,800 |
| 22% | $50,400 | $100,800 |
| 24% | $105,700 | $211,400 |
| 32% | $201,775 | $403,550 |
| 35% | $256,225 | $512,450 |
| 37% | $640,600 | $768,700 |
Adjustments for 2027 had not been published in the sources reviewed for this guide. We will update the table when they are. For a broader look at how brackets work, use our tax bracket calculator.
4. Roth Conversion Tax Calculator
Enter your 2026 taxable income before the conversion and after deductions, the amount you are considering converting, and the share of your traditional IRA balance that is pre-tax. The default is 100%, which applies if you have no after-tax IRA money. The tool shows the added federal income tax and the top bracket you would reach.
🧮 Roth Conversion Tax Calculator
| If you convert | Added federal tax | Average rate | Top bracket |
|---|
With the defaults (single, $60,000 taxable income, $50,000 converted), the added federal tax is $11,086, an average of about 22.2% on the converted amount, because most of it falls in the 22% bracket and the last part crosses into 24%. Using only $30,000 of the same conversion stays inside the 22% bracket and adds $6,600.
5. The Five-Year Rules
Two separate five-year clocks exist, and they are often mixed up. The details are in IRS Publication 590-B; the summary below is general and you should confirm it there.
- Qualified distributions of earnings. Earnings come out tax-free only if the withdrawal is "qualified": a five-tax-year period has passed since you first put money into any Roth IRA, and you are 59½ or older (or meet another listed condition such as disability or death). This clock runs once for all your Roth IRAs.
- Converted amounts. Each conversion has its own five-year period for the 10% additional tax. Withdrawing converted money within that period while under 59½ can trigger the 10% tax on the taxable part that was converted, unless an exception applies. The converted principal itself is not taxed again.
The IRS also notes that withdrawals before age 59½ may be subject to a 10% additional tax, with a chart of exceptions. Anyone under 59½ who may need the money should review Publication 590-B and Form 5329 with a professional.
6. Side Effects of Higher Income
The conversion adds to adjusted gross income, so other rules that depend on income can be affected in the same year:
- Medicare premiums. IRMAA surcharges are based on income from two years earlier, so a large conversion can raise Part B and Part D premiums later. See our Medicare IRMAA 2026 guide and calculator.
- Social Security taxation. More income can make more of your benefits taxable. Our Social Security claiming age guide covers the benefit side.
- Other thresholds. Premium tax credits, student aid, state taxes, the net investment income tax and some deductions also use income. Check each one for your situation.
7. Conversion vs Backdoor Roth vs Direct Contribution
| Feature | Roth conversion | Backdoor Roth | Direct Roth contribution |
|---|---|---|---|
| What moves | Existing pre-tax money | New nondeductible IRA contribution, then converted | New after-tax money |
| Income limit | None | None on the conversion step | Yes, by filing status and income |
| Annual cap | None | IRA contribution limit | IRA contribution limit |
| Tax at the time | Ordinary income on pre-tax part | Little or none if no other pre-tax IRA money | None |
| Form 8606 | Required | Required | Not for contributions alone |
8. Is a Roth Conversion Worth It? Both Sides
Points people make in favor:
- Qualified Roth withdrawals are tax-free, and the original owner has no required minimum distributions, according to Publication 590-B.
- Paying tax in a lower-income year can cost less than paying later at higher rates, if rates or income rise.
- A Roth balance can give flexibility in retirement because withdrawals do not add to taxable income.
Points people make against:
- The tax is due now, and paying it from the converted money itself shrinks the amount that grows tax-free.
- A conversion cannot be reversed, and markets may fall after you pay the tax.
- Higher income can raise Medicare premiums and taxes on benefits.
- If your future tax rate is lower than today's, the conversion can cost more than it saves.
Neither list settles the question. A tax professional can model your actual return, which this guide cannot do.
9. How Conversions Are Done
- Review all traditional, SEP and SIMPLE IRA balances. They affect the taxable share on Form 8606.
- Ask the custodian for a conversion. This is typically a transfer between your own accounts at the same or another custodian.
- Plan the tax payment. Many people pay from cash outside the IRA; the tax may require estimated payments. Check the IRS estimated tax rules if the added income is not covered by withholding.
- Keep records. You will receive Form 1099-R and file Form 8606 with your return.
10. Checklist and Common Mistakes
- Forgetting other IRAs. The pro-rata calculation counts all your traditional, SEP and SIMPLE IRAs.
- Using gross income in the calculator. Enter taxable income after deductions.
- Ignoring second-order effects. Medicare premiums and benefit taxation can change the real cost.
- Assuming it can be reversed. Recharacterization of conversions ended in 2018.
- Mixing up the two five-year rules. They have different starting points and consequences.
- Treating a calculator as a forecast. Future law, income and rates will differ.
11. Frequently Asked Questions
The taxable part of the conversion is added to your income for the year and taxed at ordinary federal rates, which for 2026 run from 10% to 37%. The IRS states that a conversion results in taxation of any untaxed amounts in the traditional IRA, and it is reported on Form 8606.
No. Income limits apply to direct Roth IRA contributions, not to conversions. A conversion can still raise your taxable income and affect other income-based rules.
Not for conversions made on or after January 1, 2018. The IRS states that such a conversion cannot be recharacterized.
There are two clocks. One determines when earnings can come out tax-free as a qualified distribution, starting with your first Roth IRA contribution or conversion. The other applies to each conversion and can trigger a 10% additional tax if you withdraw converted money within five years while under 59½, unless an exception applies. Confirm the details in IRS Publication 590-B.
Add the taxable converted amount to your taxable income and compare the federal tax before and after using the bracket table. Our calculator does this for single and married-filing-jointly filers with the 2026 brackets. It excludes state tax and other effects.
It can. IRMAA surcharges use income from two years earlier, so a large conversion can place you in a higher bracket for Part B and Part D premiums later.
A conversion moves existing pre-tax money into a Roth IRA and is taxed on the pre-tax part. A backdoor Roth contributes after-tax money to a traditional IRA and then converts it, which is mainly used when income is too high for direct Roth contributions. Both use Form 8606 and the pro-rata rule.
Publication 590-B states that if you are the original owner of a Roth IRA, you do not have to take distributions regardless of your age.
12. Update Archive
✅ Key Takeaways
- The taxable part of a conversion is ordinary income in the year of conversion (2026 rates: 10% to 37%).
- No income limit on conversions, but no undo since 2018.
- Form 8606 and the pro-rata rule decide the taxable share when you hold after-tax IRA money.
- Two separate five-year rules exist; confirm them in Publication 590-B.
- Higher income can affect Medicare premiums and benefit taxation.
- A calculator is an illustration; a tax professional can model your full return.
Official Resources & Further Reading
📎 Sources & References
- Internal Revenue Service, Retirement Plans FAQs regarding IRAs
- IRS, Instructions for Form 8606 (2025)
- IRS, Publication 590-B, Distributions from IRAs (Table I-2: no required distributions for the original Roth IRA owner; Roth distribution and five-year rules)
- KPMG, Rev. Proc. 2025-32: inflation adjustments for 2026 (2026 brackets and standard deduction)