High-Income Earner Planning
Roth Conversion Windows: Timing and Math
A Roth conversion moves money from a pre-tax IRA to a Roth IRA, paying ordinary income tax now in exchange for tax-free growth and tax-free withdrawals later. The math works in specific windows — and the windows close as your income rises.
When the math works
When your current marginal rate is lower than your expected future rate. Best windows: gap years between high-earning years and Social Security, sabbatical years, early retirement before RMDs begin at 73/75.
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Size to the bracket
Convert just enough to fill the current bracket without spilling into the next one. A $50K conversion that pushes you from 22% to 24% on the last $5K is wasteful — break it into a $45K conversion this year and $50K next year.
IRMAA Medicare surcharge trap
IRMAA surcharges kick in at $103K single / $206K MFJ AGI (2024). A conversion that crosses an IRMAA threshold adds hundreds per month to Medicare premiums — two years later. Model this if you're 63+.
Pay the tax from outside funds
Pay the conversion tax from non-retirement accounts, not from the converted balance. Otherwise you give up the long-term compounding the strategy depends on.
State tax matters too
A conversion before moving to a no-tax state costs more than a conversion after. Same dollar moves in a different order produce different results.
Multi-year conversion plans
The largest Roth conversion wins come from multi-year plans — converting $50K–$150K per year for 5–10 years during a low-income window — not from one big conversion.
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