Roth conversion: the questions to ask before you convert

This guide is general education. It is not tax advice for your family. Rules and limits change, so check the current IRS figures and ask your own CPA before you act.

What is a Roth conversion?

A Roth conversion moves money from a pre-tax account, such as a traditional IRA, into a Roth IRA. You pay income tax on the converted amount in the year you convert. Later, qualified withdrawals from the Roth IRA are generally tax free.

The IRS puts the first half plainly in Publication 590-B: “Conversion distributions are includible in your gross income.” That means the conversion shows up on your tax return like other income. The Roth conversion glossary entry gives the short definition.

A conversion is a trade. You pay tax now to change how money is taxed later. Whether that trade helps depends on facts only you and your tax team have. So the useful work is asking good questions first. The rest of this guide lists them.

Why ask questions before you convert?

Because a conversion is hard to reverse and it touches more than your tax bill. The IRS says a conversion made in tax years beginning after December 31, 2017 “cannot be recharacterized” as a contribution to a traditional IRA. Once you convert, the tax is yours.

Many people hear “Roth conversion” and think of one number: the tax on the amount converted. The added income can also reach other parts of your plan, such as Medicare premiums, the tax on Social Security benefits and your giving. These links are easy to miss and costly to find out after the fact.

Here is the short list. Each question gets a section below.

What will the tax bill be, and who pays it?

The tax is your ordinary income tax rate applied to the amount you convert, added on top of your other income that year. The size of the bill depends on your total income, your filing status and your state.

Here is a round example, labeled as an example only. Say you convert $50,000 in a year when the combined federal and state rate on that extra income is 30%. The added tax is $15,000. A different amount or a different income year gives a different answer.

Ask your CPA to run the numbers for a few conversion sizes, not just one. Seeing $25,000, $50,000 and $100,000 side by side shows how the extra income stacks up. California has its own income tax, so ask how it treats the conversion on your state return.

Where should the tax money come from?

Ask this before you convert. If you pay the tax from cash in a bank or brokerage account, the whole converted amount lands in the Roth IRA. If you pay the tax by withdrawing from the IRA, less goes into the Roth and the withdrawal may carry its own tax cost.

Paying from outside the IRA is the common approach to keep the converted money growing in the Roth. But it uses cash you may need for other goals, including gifts you plan to make. Plan the cash first. Then plan the conversion.

If you are under age 59½, ask your CPA how any IRA withdrawal used to pay the tax is treated. The IRS says a 10% additional tax generally applies if you withdraw or use IRA assets before age 59½.

How could a conversion affect Medicare premiums?

A conversion adds to your income, and your income can raise your Medicare Part B premium. Social Security calls the extra charge the income-related monthly adjustment amount, or IRMAA.

Medicare.gov lists the 2026 standard Part B premium as “$202.90 each month (or higher depending on your income).” Social Security says it uses your most recent federal tax return from the IRS to set the adjustment. That return can be a year or two old. So a large conversion at 63 can show up in premiums at 65.

This matters most for people near Medicare age. Ask your CPA two things:

1. Which Medicare income brackets do I sit near today?
2. Would a smaller conversion, or conversions spread across several years, keep me under the next bracket?

Check the current brackets on Medicare.gov and SSA.gov. They change each year.

How could a conversion affect tax on my Social Security?

More income can mean more of your Social Security benefit is taxed. The IRS explains the test: your benefits are not taxable unless your modified adjusted gross income plus one half of your benefits is more than the base amount for your filing status.

A conversion raises modified adjusted gross income. If you already collect benefits, or plan to soon, ask your CPA to test the effect. The tax cost of a conversion can be larger than the conversion tax alone once benefits are pulled in. The retirement income guide covers how Social Security fits with the rest of your income.

Do I have after-tax money in any IRA?

Ask this before you convert, because it changes how much of the conversion is taxable. If you ever made nondeductible contributions to a traditional IRA, part of what you convert may already have been taxed.

The IRS says you must file Form 8606 “if you receive a distribution from a traditional IRA and have ever made nondeductible contributions or rolled over after-tax amounts to any of your traditional IRAs.” That form tracks your after-tax basis. Old Forms 8606 and IRA statements from every custodian help your CPA get this right.

This is also where the backdoor Roth IRA comes up. It is a route some higher earners use to fund a Roth IRA. It runs into the same Form 8606 question, so tell your CPA about every IRA you own.

What are the 5-year rules?

There are two separate 5-year clocks, and people mix them up.

The IRS says a qualified Roth distribution must be made after the 5-year period beginning with the first tax year for which a contribution was made to a Roth IRA set up for you. It must also meet another test, such as being made on or after age 59½. The 5-year period for conversions “is separately determined for each conversion,” per Publication 590-B.

If you are 59½ or older, the conversion clock is usually less of a worry. If you are younger and may need the money, ask your CPA to map each conversion’s dates.

Can I undo a conversion if the numbers look wrong?

No, not for conversions made in 2018 or later. Older advice about “recharacterizing” a conversion no longer applies. This is the reason to estimate the tax before you convert and to keep the amount modest if you are unsure.

Some families convert in pieces over several years for this reason. A smaller piece limits the cost of a miss. This is a planning choice, not a rule. It can also be a way to stay under a tax or Medicare income line. Your CPA can say whether that fits you.

How does a conversion fit with my giving?

A conversion can help or get in the way of your giving plan, depending on how you give. Ask both questions together.

Your pre-tax IRA is the account some families give from. A qualified charitable distribution sends IRA money straight to a qualifying charity. The IRS says a QCD “will count towards your required minimum distribution.” It also leaves less pre-tax money in the IRA to convert.

So think of three jobs for your IRA: give, convert and spend. Decide how much goes to each. Our QCD guide explains the gift option. The giving appreciated stock and bunching guide shows another way to give from outside the IRA. A year with a large conversion may also be a year to time a bigger gift, a topic for your CPA.

For a Christian family, giving is often a first commitment, not a leftover. Luke 12:48 reminds us that much is required of those who are given much. Put your giving on the table when you plan a conversion.

What does a conversion mean for my heirs?

Roth IRAs do not require withdrawals during your life, but the rules change after you die. The IRS notes that “beneficiaries of Roth IRAs or Designated Roth accounts are subject to the required minimum distribution rules.” Your children will have to draw the account down on a schedule.

Many parents think about this. A Roth account can pass to heirs with a different tax profile than a pre-tax account. That is a general point, and your heirs’ own tax situations decide how it plays out. Your estate attorney should see the beneficiary forms. The trust and estate planning page explains how the pieces fit.

What should I bring to the conversation?

You will get better answers with a short file ready. Gather these before you meet your CPA or planner:

1. Your last two years of tax returns.
2. Year-end statements for every IRA and 401(k), with the custodian names.
3. Any old Forms 8606.
4. Your Social Security statement and your expected start date.
5. Your Medicare plan and your Part B premium.
6. A list of the gifts you plan to make this year and next.
7. Your beneficiary forms.

Then ask for a multi-year view, not a one-year view. A conversion decision is rarely about one year alone.

Next step

Seek First offers Tax Strategy & Filing through an in-house CPA team, or the team works with your CPA. Read more on the tax planning page and see how the firm works with families. To go through these questions with someone, schedule a free call for 20 minutes or phone (866) 398-4044.