Roth Conversion State Tax: 2026 State-by-State Guide

Your roth conversion state tax depends almost entirely on where you legally reside in the year you convert, not on where the money was originally earned or contributed. The federal government taxes every dollar of a Roth conversion as ordinary income, and then your state stacks its own income tax on top, which is why the state layer on the same conversion can range from a five-figure bill in a high-rate state to zero in a state with no income tax.

Last reviewed: July 2026 | Written and reviewed by Craig Wear, CFP®, Q3 Advisors

Does your state charge roth conversion state tax?

Most states with an income tax treat a Roth conversion as taxable ordinary income in the year you convert, mirroring the federal rule. A conversion is includible in gross income for the year you receive it (Source: IRS Publication 590-A, 2025), and states that tax ordinary income generally follow that federal starting point before applying their own rate and any exclusions.

The controlling rule is residency. Federal law prohibits a state from taxing the retirement income of a person who is not a resident or domiciliary of that state, and the statute defines retirement income to include distributions from IRAs (Source: 4 U.S.C. Sec. 114). A conversion is an IRA distribution for this purpose, so the state where you are domiciled on the conversion date generally holds the taxing right, and a state you left cannot reach back for it.

That single principle drives every planning decision below: no-income-tax states, high-rate states, retirement-income exclusions, and the timing of a move all reduce to the same question of which state you legally call home when the conversion posts.

The nine states with no roth conversion state tax

Nine states levy no broad-based individual income tax in 2026, so a resident there generally owes zero state tax on a Roth conversion (Source: Kiplinger, 2026). Only the federal tax applies. The nine are Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington, and Wyoming.

Two carry footnotes worth naming. Tennessee’s former Hall income tax on interest and dividends is fully repealed for tax years beginning on or after January 1, 2021, leaving Tennessee with no individual income tax (Source: Tennessee Department of Revenue, HIT-3). New Hampshire has never taxed earned income or IRA distributions, and its Interest and Dividends tax is repealed for tax years beginning in 2025 and later, so a New Hampshire conversion in 2026 faces no state income tax (Source: Kiplinger, 2026).

Washington taxes certain high-income capital gains, but a Roth conversion is ordinary income rather than a capital gain, so the conversion itself sits outside that tax. For a resident of any of these nine states, the entire state-tax question on a conversion is settled at $0.

High-tax states and what a conversion actually costs

In the highest-rate states, a large Roth conversion can add a five-figure state tax bill on top of the federal tax. California carries the highest top marginal individual rate in 2026 at 13.3%, followed by Hawaii, New York, and New Jersey (Source: Tax Foundation, State Individual Income Tax Rates and Brackets, 2026). The table below applies each state’s top marginal rate to a $100,000 conversion for illustration.

The illustration is stark: a $100,000 conversion at California’s 13.3% top marginal rate maps to about $13,300 of state tax, while the identical conversion by a Florida or Texas resident carries $0 in state tax (Source: Tax Foundation, State Individual Income Tax Rates and Brackets, 2026). Top marginal rates only apply to income above high thresholds, so a taxpayer whose conversion is not entirely in the top bracket would owe less than the flat figures above.

Larger conversions scale the exposure. Applying California’s 13.3% top rate as a ceiling, the illustrative state tax rises with the conversion size, as the second table shows. The actual tax is lower to the extent the conversion fills brackets below the top rate.

Pennsylvania and Illinois: the exception most guides miss

Several widely shared guides describe a Roth conversion as fully taxable as ordinary income in Pennsylvania and Illinois. That is generally not how these two states treat the conversion event, and the distinction can be worth thousands. Each broadly excludes qualified retirement income from state tax, and a conversion transferred directly between plans often falls inside that exclusion.

Pennsylvania is the clearest case. Pennsylvania Department of Revenue guidance treats monies moved from a traditional IRA to a Roth IRA by a trustee-to-trustee transfer or a 60-day rollover as generally not subject to Pennsylvania personal income tax, on the view that it is a transfer between retirement plans rather than a taxable distribution. Amounts that are not actually placed in the Roth IRA, such as funds withheld to pay taxes, are subject to Pennsylvania tax (Source: Pennsylvania Department of Revenue, Taxability of Roth IRAs according to PA income tax rules). A resident whose tax withholding is paid from outside funds may therefore see little or no Pennsylvania tax on the conversion, even though the full amount is federally taxable.

Illinois takes a similar position. The Illinois Department of Revenue does not tax a traditional IRA that has been converted to a Roth IRA, so a conversion by an Illinois resident is generally not taxed at the state level (Source: Illinois Department of Revenue). Mississippi separately exempts qualified retirement plan distributions for taxpayers who have reached retirement age, though whether that exemption reaches a conversion specifically is less settled than in Pennsylvania and Illinois. Because state treatment can vary with the facts, the current position of a taxpayer’s own state revenue department is the controlling reference. This is exactly the kind of state-specific taxability question that separates a conversion that costs nothing at the state level from one that does not.

State retirement-income breaks that may or may not apply

Some income-taxing states offer retirement-income exclusions, but whether an exclusion reaches a Roth conversion depends on the state’s rules and often on your age. These breaks can shrink the conversion’s state tax, yet they rarely eliminate it for a large conversion, and several exclude conversions entirely.

New York allows residents who were age 59.5 or older for the full year to exclude up to $20,000 of qualified private pension and annuity income, which can offset part of a conversion for eligible taxpayers, while the state’s top marginal rate still reaches 10.9% on amounts above the exclusion (Source: New York State Department of Taxation and Finance, Information for retired persons; Tax Foundation, State Individual Income Tax Rates and Brackets, 2026). Iowa fully exempts qualifying retirement income for taxpayers age 55 and older, with no dollar cap, for tax years beginning in 2023 and later, though whether that exemption reaches a conversion depends on Iowa’s rules (Source: Iowa Department of Revenue, Retirement Income Tax Guidance).

The lesson is that an advertised retirement-income break is not a guarantee for conversions. Verify the age threshold, the dollar cap, and whether the state counts a conversion as qualifying income before assuming relief applies.

The move-then-convert timing question and its traps

Because the taxing right follows residency on the conversion date (Source: 4 U.S.C. Sec. 114), a bona fide change of domicile from a high-tax state to a no-tax state before a conversion can remove the state layer entirely. The mechanics are demanding: the move must be genuine, and a mid-year relocation rarely produces a clean break for the conversion year.

Residency for this purpose turns on several factors that high-tax states examine closely:

• Domicile is established by the location of a person’s primary home, driver’s license, voter registration, and center of life, not merely by owning property in the new state.
• High-tax states such as California and New York run residency audits and apply domicile and day-count tests to challenge a claimed relocation.
• A conversion completed after residency in the new state is established for the year falls under the new state’s rules, while one completed earlier may not.
• Part-year residents are taxed on income apportioned to the period they lived in the old state, so a conversion done close to a move can still be reached by the former state.

The direction of a move interacts with the timing. A conversion completed while a person is still resident in a higher-tax state is taxed by that state, whereas one completed after residency in a lower-tax state is established generally is not. Because residency mechanics are technical and heavily audited, this is an area where people often work with a qualified professional.

Estimated taxes, withholding, and conversion-year mechanics

A conversion can trigger state estimated-tax obligations that catch filers off guard. Because no employer withholds on a conversion by default, both the IRS and most state revenue departments expect the tax to be paid through withholding or quarterly estimated payments during the year, and a shortfall can produce underpayment penalties at the state level as well as the federal.

One mechanical point matters for Pennsylvania and similar states: electing to withhold state tax directly from the converted amount can create a taxable, and possibly penalized, distribution of the withheld portion, because that money is not placed in the Roth. When the tax is instead paid from separate funds, the full converted amount remains in the Roth. Conversions made in 2018 or later cannot be recharacterized or undone (Source: IRS Publication 590-A, 2025), so a conversion is final once it is completed.

Timing a conversion in a low-income or down-market year

The conversion year’s tax depends on the federal bracket the conversion fills plus your state’s rate, so timing the conversion into a low-income year, or during a market downturn when account values are depressed, can lower the combined bill. There is no dollar limit on how much you may convert (Source: IRS Publication 590-A, 2025), which gives room to size a conversion to fill a target bracket.

The 2026 federal ordinary-income brackets set the floor. For married couples filing jointly, the 22% bracket runs to $211,400 of taxable income and the 24% bracket to $403,550, with a 32% bracket beginning above that (Source: Rev. Proc. 2025-32). A conversion also raises provisional income, which can increase the taxable share of Social Security benefits under fixed statutory thresholds of $32,000 and $44,000 for joint filers (Source: 26 U.S.C. Sec. 86); our guide to the Social Security tax torpedo explains that interaction. Because conversion income can also affect Medicare surcharges, some people coordinate the conversion year with their required minimum distribution planning. For the broader picture of which states leave retirement income alone, see our companion guide on states that do not tax retirement income.

Frequently asked questions

These questions address the state-level issues that most often arise with a Roth conversion: which states tax it, how residency and relocation affect the result, and how the state layer interacts with the federal tax. Each answer reflects 2026 rules and general treatment, and a taxpayer’s own facts and state of residence can change the outcome in a given year.

Do you have to pay state taxes on a Roth conversion?

It depends on your state of residence. In the nine states with no individual income tax, including Florida and Texas, a Roth conversion carries no state tax in 2026 (Source: Kiplinger, 2026). In income-taxing states the conversion is generally taxed as ordinary income at the state’s rate, though states such as Pennsylvania and Illinois broadly exclude qualified retirement income.

Can I do a Roth conversion after moving to Florida to avoid California tax?

The rules allow it if you establish genuine domicile in Florida before the conversion, because the taxing right follows residency in the conversion year (Source: 4 U.S.C. Sec. 114). The move must be real, and California audits claimed relocations closely. Converting before the move is complete, or as a part-year resident, can leave the amount subject to California tax.

Does Illinois tax Roth IRA conversions?

Illinois generally does not tax qualified retirement plan distributions, and a Roth conversion by an Illinois resident typically falls inside that exclusion, so it is often not taxed at the state level (Source: Illinois Department of Revenue). The full amount remains taxable federally. Guides that call the conversion fully state-taxable in Illinois generally misstate the state’s treatment.

Does Pennsylvania tax Roth conversions?

Pennsylvania Department of Revenue guidance generally treats a trustee-to-trustee conversion from a traditional IRA to a Roth IRA as not subject to Pennsylvania personal income tax, viewing it as a transfer between retirement plans. Amounts not rolled over, such as funds withheld for taxes, can be taxable (Source: Pennsylvania Department of Revenue). The full conversion is still federally taxable.

What is the best year to do a large Roth conversion?

There is no single best year, but many people target a year of lower ordinary income or a market downturn, because the conversion fills federal brackets that in 2026 reach 22% up to $211,400 for joint filers (Source: Rev. Proc. 2025-32). Residency also matters, since a low-tax or no-tax state can remove the state layer entirely.

Why does state matter for Roth conversions?

State matters because a conversion is taxed by your state of residence on top of the federal tax, and top marginal rates range from 0% in nine states to 13.3% in California (Source: Tax Foundation, State Individual Income Tax Rates and Brackets, 2026). On a $100,000 conversion that spread illustrates the difference between $0 and roughly $13,300 in state tax alone.

Should I move to do a Roth conversion?

Relocating before converting is one approach that can eliminate state tax on the conversion, but it only works if you establish genuine domicile and meet the new state’s residency rules. High-tax states audit moves aggressively, and part-year apportionment can pull the conversion back into the old state. This is a fact-specific decision rather than a general recommendation.

Is there a limit on Roth conversions?

No. There is no dollar cap and no income limit on Roth conversions; regardless of your adjusted gross income, you may convert (Source: IRS Publication 590-A, 2025). The annual limits people see, such as the $7,500 IRA contribution limit for 2026 (Source: IRS Notice 2025-67), apply to contributions, not conversions.

Sources

IRS Publication 590-A (2025), Contributions to Individual Retirement Arrangements, https://www.irs.gov/publications/p590a
IRS Topic No. 558, Additional Tax on Early Distributions, https://www.irs.gov/taxtopics/tc558
Rev. Proc. 2025-32, 2026 inflation-adjusted tax brackets, https://www.irs.gov/pub/irs-drop/rp-25-32.pdf
IRS Notice 2025-67, 2026 retirement plan limits, https://www.irs.gov/pub/irs-drop/n-25-67.pdf
4 U.S.C. Sec. 114, limitation on state taxation of nonresident retirement income, https://www.law.cornell.edu/uscode/text/4/114
26 U.S.C. Sec. 86, taxation of Social Security benefits, https://www.law.cornell.edu/uscode/text/26/86
Tennessee Department of Revenue, HIT-3, Hall Income Tax Repealed, https://revenue.support.tn.gov/hc/en-us/articles/360057828631-HIT-3-Hall-Income-Tax-Repealed-Beginning-January-1-2021
Tax Foundation, State Individual Income Tax Rates and Brackets, 2026, https://taxfoundation.org/data/all/state/state-income-tax-rates-2026/
Kiplinger, States With No Income Tax / States That Don’t Tax Retirement Income (2026), https://www.kiplinger.com/taxes/states-that-dont-tax-retirement-income
Pennsylvania Department of Revenue, Taxability of Roth IRAs according to PA income tax rules, https://revenue-pa.custhelp.com/app/answers/detail/a_id/274
Illinois Department of Revenue, Does Illinois tax my pension, Social Security, or retirement income, https://tax.illinois.gov/questionsandanswers/answer.99.html
New York State Department of Taxation and Finance, Information for retired persons, https://www.tax.ny.gov/pit/file/information_for_seniors.htm
Iowa Department of Revenue, Retirement Income Tax Guidance, https://revenue.iowa.gov/taxes/tax-guidance/individual-income-tax/retirement-income-tax-guidance

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