Roth Rollover Calculator

Formatting only. This does not change the calculation.
Wages and other income taxed at ordinary rates, before deductions and before the conversion.
Leave at 0 to use the standard deduction for the year and filing status.
Non-deductible contributions you have already paid tax on.
The comparison turns on this: converting wins when your future rate is higher than the rate the conversion is taxed at now.
Total tax cost of converting
23,164.00
Roth Conversion Calculator
Taxable portion of the conversion
100,000.00
Tax-free portion (return of basis)
0.00
Taxable fraction under the pro-rata rule
1.000000
Federal tax the conversion adds
23,164.00
State tax on the conversion
0.00
10% additional tax on amounts withheld, not converted
0.00
Effective tax rate on the conversion
23.16 %
Marginal rate before the conversion
22.00 %
Marginal rate after the conversion
24.00 %
Amount that actually reaches the Roth
100,000.00
Roth value when you withdraw
386,968.45
Leaving it pre-tax, after tax at withdrawal
301,835.39
Advantage of converting
85,133.06
Which comes out ahead
Converting comes out ahead on these assumptions
Worked out from 26 U.S.C. 408A(d)(3) - a conversion is treated as a distribution includible in gross income in the year of conversion, and the 10% additional tax does not apply to the converted amount and 2 other sources.
A converted amount has its own five-year clock under IRC 408A(d)(3)(F) before it can be withdrawn penalty-free, separate from the five-year clock for earnings.
An estimate from published federal rate tables. It does not model AMT, IRMAA Medicare surcharges, net investment income tax, the taxation of Social Security benefits, credit phase-outs or state rules beyond one flat rate - all of which a large conversion can trigger. Confirm with a tax adviser before converting.

How this is worked out

7 steps
  1. A pre-tax employer plan rolled into a Roth IRA is taxable in full.
  2. Taxable income without the conversion = 80000 - 16100 (2026 standard deduction) = 63900, tax 8770.
  3. Taxable income with it = 163900, tax 31934.
  4. Federal tax the conversion adds = 31934 - 8770 = 23164.
  5. The conversion pushes you from the 22% bracket into the 24% bracket, so part of it is taxed at each rate in between.
  6. In 20 years at 7% the Roth holds 386968.45, all of it yours if the distribution is qualified.
  7. Left pre-tax, the same 100000 grows to 386968.45 and is taxed at 22% on the taxable share, leaving 301835.39.

Results are general information, not financial, tax, legal, medical or engineering advice.