Run A Roth Conversion Calculation Before Making A Decision
Model a multi-year Roth conversion strategy based on your situation. Qualified Roth withdrawals are generally federal income–tax-free, subject to IRS rules including the 5-year holding period. Educational tool — not individualized tax, legal, or investment advice.
Key Considerations
Three things to understand about Roth conversions.
Tax law can change, and future tax rates are uncertain. Modeling different scenarios can help you understand the potential trade-offs before you make any decision. A Roth conversion is not appropriate for everyone.
Tax Withheld From Conversion
Federal (and where applicable, state) tax can often be withheld from the converted balance, so you may not need to write a separate check. Doing so reduces the amount that grows tax-free, and amounts withheld before age 59½ may be subject to a 10% additional tax.
Multi-Year Bracket Targeting
Model conversions across multiple tax years designed to target lower brackets. Actual results depend on your future income, deductions, and tax law, and cannot be guaranteed.
Sized To Your Plan
Conversions are sized based on your goals and current bracket. Roth conversions are irrevocable, the converted amount is taxable in the year of conversion, and investment values fluctuate and can lose value.
Potential Considerations
Taxes to consider inside a Traditional IRA.
Pre-tax retirement balances are generally taxable when withdrawn. The factors below may affect your future tax picture; their impact depends on your individual circumstances.
See whether a Roth conversion strategy may fit your situation.
Complimentary educational illustration based on the information you provide. Hypothetical and not a prediction of future results. Completing this illustration does not create an advisory relationship. Any recommendation would come only from an independent licensed professional after reviewing your full situation.
What state do you live in?
State income tax rules materially affect your Roth conversion strategy.