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How to Do a Roth Conversion Before December 31, 2026: Step by Step, With the 2026 Tax Brackets
A Roth conversion moves pre-tax money from a traditional IRA (or old 401(k)) into a Roth IRA. You pay ordinary income tax on the amount converted in the year you convert, and future qualified withdrawals are tax-free. To do it: 1. estimate your 2026 taxable income; 2. convert enough to 'fill up' your current bracket (for 2026, the 22% bracket tops out at $105,700 of taxable income for single filers and $211,400 for married couples filing jointly); 3. request the conversion at your broker; 4. pay the tax from non-retirement savings. The conversion must be completed by December 31, 2026 to count for 2026, and it can't be undone.
What a Roth conversion is
A Roth conversion moves money from a pre-tax retirement account, usually a traditional IRA or an old 401(k) rolled into an IRA, into a Roth IRA.
- You pay income tax now on the amount you convert.
- After that, the money grows tax-free, and qualified withdrawals in retirement are tax-free.
- Roth IRAs have no required minimum distributions for the original owner.
There's no income limit on conversions, and no limit on how much you can convert.
Should you convert? Five questions
1. Is your tax rate likely higher later? Converting makes sense when today's rate is lower than the rate you'd pay in retirement.
2. Is this a low-income year? Job loss, a sabbatical, a gap between retirement and Social Security, or a big business loss can create a cheap window.
3. Can you pay the tax from outside the IRA? Paying from savings means the full amount keeps growing tax-free. Paying from the IRA itself shrinks the benefit, and under 59½ the withheld portion can trigger a 10% penalty.
4. Will big RMDs push you into higher brackets later? Large traditional balances force required minimum distributions starting at 73 (rising to 75 for people born in 1960 or later). Converting earlier smooths that out.
5. Are you near Medicare? Higher income can raise Medicare Part B and D premiums (IRMAA) two years later. A conversion at 63 or older can affect premiums at 65.
How much to convert: "fill the bracket"
The most common strategy is to convert just enough to reach the top of your current tax bracket, without spilling into the next one.
2026 federal tax brackets (taxable income):
| Rate | Single | Married filing jointly |
|---|---|---|
| 10% | up to $12,400 | up to $24,800 |
| 12% | $12,401 – $50,400 | $24,801 – $100,800 |
| 22% | $50,401 – $105,700 | $100,801 – $211,400 |
| 24% | $105,701 – $201,775 | $211,401 – $403,550 |
| 32% | $201,776 – $256,225 | $403,551 – $512,450 |
| 35% | $256,226 – $640,600 | $512,451 – $768,700 |
| 37% | over $640,600 | over $768,700 |
Source: IRS tax year 2026 inflation adjustments. The standard deduction is $16,100 (single) and $32,200 (married filing jointly).
Example: A married couple expects $150,000 of taxable income in 2026. The 22% bracket ends at $211,400, so they could convert up to about $61,400 and stay in the 22% bracket. Federal tax on the conversion: about $13,500.
Converting $100,000 instead would push about $38,600 into the 24% bracket. That may still be fine, but it should be a deliberate choice.
Step by step: how to do it
Step 1: Estimate your 2026 income
Add up wages, interest, dividends, capital gains and other income. Subtract your deduction. Your last pay stub and last year's return are good starting points.
Step 2: Choose the amount
Use the bracket table. Many people convert in chunks over several years rather than all at once.
Step 3: Open a Roth IRA (if you don't have one)
At the same broker as your traditional IRA is easiest. It takes about 10 minutes. See how to open a Roth IRA.
Step 4: Request the conversion
At most brokers (Fidelity, Schwab, Vanguard and others), go to your traditional IRA and choose "Convert to Roth." You can convert cash or move investments in kind (no need to sell). Choose no tax withholding if you'll pay the tax from savings.
Step 5: Plan the tax payment
The conversion adds to your 2026 tax bill. To avoid an underpayment penalty, you can increase withholding from your paycheck before year-end or make an estimated tax payment by January 15, 2027.
Step 6: Report it
You'll get a Form 1099-R from your broker in early 2027. Report the conversion on your tax return, and file Form 8606 if you have any after-tax (nondeductible) IRA money.
Rules that trip people up
- No undo. Recharacterizations were eliminated in 2018.
- Deadline is December 31, not the April tax deadline.
- Five-year rule: each conversion has its own five-year clock for the 10% penalty if you're under 59½.
- Pro-rata rule: if you have both pre-tax and after-tax IRA money, you can't convert just the after-tax part. This is the same rule that complicates a backdoor Roth IRA.
- RMD first: if you're already taking required minimum distributions, you must take this year's RMD before converting.
- State taxes: conversions are generally taxable in states with an income tax.
When a conversion is probably a bad idea
- You'd have to pay the tax from the IRA itself.
- You expect to be in a lower bracket in retirement.
- You plan to leave the money to charity (charities don't pay income tax on inherited traditional IRAs).
- You need the money within five years and you're under 59½.
The bottom line
A Roth conversion is a trade: tax now for tax-free growth later. The sweet spot is a year when your income is lower than usual and you can pay the tax from savings. Pick an amount that fills your current bracket, complete it before December 31, 2026, and plan the tax payment. If the numbers are large, a tax professional can model it with your full situation.
This article is educational and not personalized tax advice.
Frequently asked questions
What is the deadline for a Roth conversion in 2026?
December 31, 2026. A conversion counts in the tax year it is completed. Unlike IRA contributions, you can't make a conversion in early 2027 and count it for 2026. Start a few weeks before year-end because brokers get busy.
How much tax will I pay on a Roth conversion?
The converted amount is added to your taxable income and taxed at your ordinary income tax rates, plus state income tax if applicable. For example, converting $20,000 while you are in the 22% federal bracket adds about $4,400 in federal tax.
Can I undo a Roth conversion?
No. Since 2018, recharacterizing (reversing) a Roth conversion is not allowed. Once it's done, the tax bill is locked in, so plan the amount carefully.
What is the five-year rule for Roth conversions?
Each conversion has its own five-year clock, starting January 1 of the year you convert. If you're under 59½ and withdraw converted money before five years pass, you may owe a 10% penalty on that amount. A separate five-year rule applies to tax-free withdrawal of earnings.
What is the pro-rata rule?
If you have both pre-tax and after-tax (nondeductible) money in traditional, SEP or SIMPLE IRAs, the IRS treats any conversion as a proportional mix of both. You can't convert only the after-tax portion. The calculation uses your total IRA balances on December 31 and is reported on Form 8606.
Who should consider a Roth conversion?
People who expect to be in a higher tax bracket later, have a temporarily low-income year (job loss, sabbatical, early retirement before Social Security), have large traditional balances that will force big required minimum distributions, or want to leave tax-free money to heirs. It usually works best if you can pay the tax from outside the IRA.
Primary sources
Data & disclaimer: This article is for educational purposes only and is not financial or investment advice. Figures reflect data available as of Oct 28, 2026, and conditions change — always confirm current pricing, rates and rules with the provider before you act. Written by Elizabeta Dimoska. See our editorial standards and disclosure.
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