A Roth conversion before year end has to be fully completed at your custodian by December 31, not merely started, so the timing decision is really a sequencing decision. Before you move any money, project your full-year income, take any required minimum distribution first, and model how the added income touches your tax bracket, Medicare premiums, and Social Security.
A Roth conversion before year end must be completed at your custodian by December 31, 2026 to count for the 2026 tax year, unlike an IRA contribution, which you can make until the April filing deadline. The converted amount is taxable ordinary income, and a conversion cannot be reversed. Before you convert, project your income, take your RMD first if you are 73 or older, and pay the tax from non-IRA funds.
Why does the year-end deadline matter for a Roth conversion?
The Roth conversion deadline is December 31, and the conversion must be completed by that date, not just requested. This differs from an IRA contribution, which you can make up to the April tax filing deadline for the prior year. Because custodians need processing time and some close conversion requests in mid-December, starting early protects the deadline.
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A conversion is credited to the tax year in which the money actually leaves the traditional IRA and lands in the Roth IRA, with no lookback window. If the transfer settles on January 2, it belongs to the new tax year even if you submitted the paperwork in December.
Many custodians impose an internal cutoff several business days before December 31 and slow down during the holidays, so confirm your firm’s cutoff and initiate the request early. Review the mechanics on our 2026 Roth conversion deadline page, and for a task-by-task execution list, follow our year-end Roth conversion checklist.
Should you do a Roth conversion before year-end, or wait?
Year end is when your income picture is clearest: bonuses, capital gains, business results, and charitable gifts are largely known, so you can size a conversion to your remaining bracket headroom. Many investors convert now when they have a low-income year or cash outside the IRA to pay the tax. Waiting can make sense when you expect a lower bracket next year, cannot pay the tax from savings, or sit near an income cliff.
By the fourth quarter, most of the year’s income is settled, which removes much of the guesswork that makes a January conversion harder to size. That clarity is the practical reason year-end conversions are common. If you buy coverage through the ACA marketplace, remember that conversion income raises your MAGI and can reduce a premium tax credit.
| Reasons many investors convert now | Reasons to consider waiting |
|---|---|
| You are in a temporarily low tax bracket this year | You expect a lower marginal rate next year |
| You can pay the tax from non-IRA (taxable) funds | You would have to use IRA money to pay the tax |
| Room remains before the next bracket or IRMAA tier | The conversion would cross an ACA premium tax credit income cliff |
| You want to reduce future RMDs and the taxable estate for heirs | Added income would raise Medicare premiums two years out and you want to avoid it this year |
Step 1: Project your full-year income and remaining bracket headroom
A Roth conversion is uncapped, taxable ordinary income that stacks on top of your other income. The common approach is a partial conversion that fills up your current bracket without spilling into the next one. Estimate your 2026 taxable income, subtract it from the top of your target bracket, and convert roughly that difference.
Start with your projected taxable income after the 2026 standard deduction of $16,100 (single) or $32,200 (married filing jointly), plus the additional $2,050 single or $1,650 per spouse age 65 and older. The gap between that figure and your bracket ceiling is your headroom.
| 2026 marginal rate | Single taxable income | Married filing jointly |
|---|---|---|
| 22% | starts at $50,400 | starts at $100,800 |
| 24% (top) | up to $201,775 | up to $403,550 |
| 32% (top) | up to $256,225 | up to $512,450 |
| 35% (top) | up to $640,600 | up to $768,700 |
| 37% | over $640,600 | over $768,700 |
For example, a married couple with $250,000 of projected taxable income has about $153,550 of room before the top of the 24% bracket at $403,550, and a conversion up to that amount stays taxed at 24%. Deciding how far to fill is where our guides on how much to convert to a Roth and the Roth conversion break-even can help. Watch long-term capital gains too: the 2026 0% rate applies up to $98,900 of taxable income for joint filers, and conversion income can push gains out of that band.
Step 2: Take your RMD first if you are 73 or older
If you are 73 or older, you must take your required minimum distribution (RMD) before converting, and the RMD amount itself cannot be converted to a Roth IRA. The IRS treats the first dollars out of the account each year as satisfying the RMD, so the RMD comes out first and only amounts above it are eligible for conversion.
The RMD age is 73 for most retirees, rising to 75 for those born in 1960 or later (the earliest age-75 RMD year is 2035). The RMD is taxable ordinary income that stacks with any conversion, so include both when you size the conversion in Step 1. Skipping or mistiming an RMD carries a penalty, so confirm the amount early using our 2026 required minimum distribution guide.
Step 3: Model the Medicare (IRMAA) and Social Security impact
Medicare Part B and Part D premiums use a two-year MAGI lookback, so a 2026 conversion can raise your 2028 premiums through the income-related monthly adjustment amount (IRMAA). The 2026 IRMAA surcharge begins above $109,000 MAGI (single) or $218,000 (joint), on top of the $202.90 standard Part B premium. Conversion income can also cause up to 85% of Social Security benefits to be taxable.
IRMAA is a cliff, not a gradual phase-in: crossing a threshold by one dollar moves you to a higher premium tier for the whole year. Because the lookback is two years, the last conversion year that will not affect a Medicare premium is the year you turn 62.
Conversion income also feeds the formula that determines how much of your Social Security is taxable. The conversion itself is not net investment income, but by raising your total income it can expose other investment income to the 3.8% net investment income tax above $200,000 (single) or $250,000 (joint), as our 2026 NIIT guide explains.
Step 4: Plan how you will pay the conversion tax
Pay the conversion tax from non-IRA funds, such as a taxable brokerage or savings account, so the full converted balance stays inside the Roth to grow. The tax is not due the day you convert. It is reported and paid with your return by the April filing deadline, but a large conversion can create a quarterly estimated-tax or safe-harbor obligation.
Using IRA dollars to pay the tax shrinks the amount that grows tax-free, and anyone under age 59 and a half who does so may owe a 10% penalty on the withdrawn portion. Cash from outside the retirement account avoids both problems.
Because the added income is not covered by withholding, the IRS may expect estimated payments. Meeting a safe harbor (generally paying 100% of last year’s tax, or 110% at higher income) can help you avoid an underpayment penalty, so ask your tax preparer before December 31 whether a fourth-quarter payment is warranted.
Step 5: Weigh the 5-year rule, the 10-year heir rule, and future tax law
Each Roth conversion starts its own 5-year clock: withdraw converted principal before five years and before age 59 and a half and a 10% penalty can apply. Under the SECURE Act, most non-spouse heirs must empty an inherited IRA within 10 years. A conversion has been irreversible since 2018, so convert deliberately.
The 5-year rule for conversions is separate from the 5-year rule for Roth earnings. Each conversion has its own five-year holding period before the converted amount can be withdrawn free of the 10% early-distribution penalty if you are under 59 and a half.
For heirs, the SECURE Act 10-year rule requires most non-spouse beneficiaries to empty an inherited IRA within ten years. Inherited Roth withdrawals are generally income-tax-free to those beneficiaries, which is one reason many families convert during their lifetime to reduce the tax their heirs would owe on a traditional IRA.
On future rates, the 2017 Tax Cuts and Jobs Act brackets were made permanent under the One Big Beautiful Bill Act (P.L. 119-21), so the earlier “rates may sunset” concern no longer drives the decision. Because a conversion cannot be undone, size it to your own projected income, not a rate forecast. See our Roth conversion service page and the best time of year for a Roth IRA conversion for timing beyond the December deadline.
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Frequently asked questions
When is the deadline for a Roth conversion?
The deadline for a Roth conversion is December 31 of the tax year, and the conversion must be fully completed at your custodian by that date. Unlike an IRA contribution, which you can make until the April filing deadline, a conversion has no grace period. Because custodians need processing time near year end, initiate the request in early December.
Do you have to pay taxes on a Roth conversion right away?
No. The converted amount is taxable ordinary income for the year you convert, but the tax is paid when you file your return by the April deadline, not on the day of the conversion. A large conversion can create a quarterly estimated-tax or safe-harbor obligation, so confirm with your tax preparer whether a fourth-quarter payment is needed.
Can you reverse or undo a Roth conversion?
No. A Roth conversion cannot be reversed or undone. The Tax Cuts and Jobs Act eliminated conversion recharacterization effective in 2018, so conversions have been irreversible ever since. Any older guidance describing “recharacterizing” a conversion back to a traditional IRA is out of date. Because the decision is permanent, size and time each conversion deliberately.
Do I have to take my RMD before doing a Roth conversion?
Yes, if you are 73 or older. You must take your required minimum distribution before converting, and the RMD amount cannot be converted to a Roth IRA. The IRS treats the first dollars withdrawn each year as satisfying the RMD, so only amounts above your RMD are eligible for conversion. The RMD age rises to 75 for those born in 1960 or later.
How does a Roth conversion affect Medicare premiums (IRMAA)?
A Roth conversion raises your modified adjusted gross income, and Medicare uses a two-year lookback, so a 2026 conversion can increase your 2028 Part B and Part D premiums through IRMAA. The 2026 surcharge begins above $109,000 MAGI for single filers or $218,000 for joint filers, on top of the $202.90 standard Part B premium. IRMAA is a cliff, so model the thresholds first.
What is the 5-year rule for Roth conversions?
Each Roth conversion starts its own five-year holding period. If you withdraw the converted principal before five years have passed and before age 59 and a half, a 10% penalty can apply to that amount. This conversion 5-year rule is separate from the rule governing tax-free Roth earnings, and each conversion carries its own clock.
Is it better to do a Roth conversion at the beginning or end of the year?
Both timings can work. Year end gives the clearest income picture, since bonuses, capital gains, and business results are largely known, which helps you size a partial conversion to your bracket. Converting early in the year gives the assets more time to grow tax-free. Many investors project income in the fourth quarter and convert then, but the right timing depends on your situation.
