Roth Conversion Break-Even Calculator
A Roth conversion moves money from a traditional IRA to a Roth IRA, paying income tax now in exchange for tax-free growth and withdrawals later. This calculator shows the tax cost today and how long it takes for tax-free growth to break even.
Current Situation (This Year)
Retirement Assumptions
How to Think About Roth Conversions
The core question is simple: Is my tax rate higher today or in retirement? If you expect a higher rate in retirement (due to RMDs, pension income, or Social Security), paying tax now at a lower rate is a win. If your retirement rate will be lower, the conversion costs more than it saves.
The real comparison is marginal rate today vs. average rate in retirement. Today’s conversion is taxed at your current marginal rate. But in retirement, the avoided withdrawal fills brackets from the bottom — so the relevant comparison is the average rate on that withdrawal, not the marginal rate.
IRMAA is the hidden cost. A conversion that pushes your MAGI above an IRMAA threshold triggers Medicare surcharges two years later. A $50K conversion that bumps you into Tier 1 costs an extra ~$2,400/year in premiums. This calculator includes that cost.
Partial conversions are often better than all-or-nothing. Convert just enough to fill your current bracket without spilling into the next one, or stay below an IRMAA cliff.