The question people arrive at too late

For decades, the advice was consistent: contribute to your traditional 401(k) or IRA, get the tax deduction now, and let the money grow. The tax bill comes later.

Later is now.

If you're approaching or recently entered retirement with a large traditional IRA or 401(k) — and Social Security hasn't started yet, and required minimum distributions haven't kicked in — you're sitting inside one of the most valuable tax-planning windows of your financial life.

The question is: are you using it?

The core idea: the low-tax gap

Here's the structure of most retirees' income over time:

  • Working years: High income, high marginal rates. Contributing to traditional IRA makes sense — the deduction saves you money at high rates.
  • The gap: You've retired, but you haven't yet claimed Social Security and you haven't hit the age for required minimum distributions (73 under current law). Income is often at its lowest.
  • Later retirement: Social Security kicks in. RMDs (the withdrawals the IRS requires from traditional accounts once you turn 73) begin and grow each year. Income rises, marginal rates rise, and potentially Medicare surcharges begin.

The gap is the window. Income is low, marginal rates are low, and you have the ability to choose how much income to recognize. This is the moment to pay a manageable tax bill voluntarily, rather than facing a larger involuntary bill later.

The mechanism is a Roth conversion: you take money out of your traditional IRA, pay ordinary income tax on it now, and move it into a Roth account where it will grow tax-free and never be subject to required distributions.

How bracket filling works

The goal of a Roth conversion strategy in the gap years is to fill your tax bracket — take out enough from the traditional account to reach, but not cross, the top of a lower tax bracket.

For a married couple filing jointly in 2026, for example, ordinary income up to about $100,800 falls in the 12% bracket, and income up to about $211,400 stays in the 22% bracket. If your other income (pension, part-time wages) leaves you with significant room before hitting the 22% ceiling, you could convert that room from traditional to Roth each year, paying 22% or less on the conversion.

Why does this matter? Because if you don't convert now, those funds stay in the traditional account, continue to grow, and become subject to forced distributions starting at 73. Those RMDs are also taxed as ordinary income — but by then, you may also have Social Security income, which can push a larger share of your total income into higher brackets and trigger IRMAA (the income-based Medicare Part B and D surcharges that add hundreds to thousands of dollars annually).

Converting now, at lower rates, avoids a larger forced bill later.

A worked example with real numbers

Consider a married couple aged 60 with $500,000 in a traditional IRA, no Roth balance, and $30,000 in other annual income. They fill the 22% bracket each year through conversions until age 80.

Running this through the calculator with 6% annual growth, filing jointly: the converting scenario produces an after-tax terminal value that is $62,546 more than the no-conversion scenario.

That figure comes directly from the engine that powers the Roth calculator — which applies 2026 tax law, IRMAA lookback rules, and models both scenarios year by year. It's not an illustration. It's a calculation.

The number varies depending on your starting balance, income, bracket, and assumed growth. It can be smaller or larger. The direction — conversion generally helps when done in low-income years — is consistent.

The planning interlock: why these decisions compound

The Roth conversion window doesn't exist in isolation. It connects to the other Red Zone decisions in ways that matter.

Roth conversions reduce future RMDs. Every dollar you convert now is a dollar that won't be in the traditional account later. Smaller traditional balances mean smaller required distributions starting at 73. Smaller RMDs mean lower taxable income, potentially keeping you in lower brackets and below IRMAA thresholds throughout your 70s and 80s.

Smaller RMDs soften the widow's tax penalty. When one spouse dies, the survivor files as single instead of married filing jointly. Single filers face narrower tax brackets and lower IRMAA thresholds — the same income can generate a much larger tax bill. If Roth conversions have already reduced the traditional balance, the RMDs that remain are smaller, which means the surviving spouse's involuntary income is lower. The tax hit at a painful time is reduced.

Delaying Social Security extends the window. If you retire at 65 and delay claiming SS until 70, you have five years of lower income — five years to convert at lower rates. If you claim SS at 62, you have fewer gap years and less room to convert before SS income raises your bracket. These two decisions reinforce each other.

IRMAA is avoidable with planning. IRMAA surcharges are based on your income two years prior. If conversions in the gap years are sized to keep your MAGI (modified adjusted gross income) below the IRMAA threshold, you avoid surcharges in the years when Medicare coverage begins. Conversely, if large conversions push you over a threshold, you pay surcharges for that year. Modeling the IRMAA breakpoints as a constraint on conversion size is a routine part of good gap-year planning.

What the calculator shows you

The Roth conversion calculator compares two scenarios — converting and not converting — year by year. It accounts for conversion taxes, RMD taxes, IRMAA surcharges using the two-year lookback, and terminal after-tax values.

The inputs that matter most: your current traditional balance, current Roth balance, filing status, other income (non-SS), expected Social Security (if any), growth assumption, target bracket for conversion, and the age through which you want to model.

Run your numbers →

Common mistakes

  • Waiting until 73 to think about this. Once RMDs are mandatory, you've lost the ability to choose how much to recognize. Converting in forced distribution years is possible but less effective — the RMD itself is already income you owe tax on, which limits the additional room for conversions without crossing into higher brackets.
  • Converting too aggressively and triggering IRMAA. Large conversions that push your MAGI over an IRMAA threshold cost you surcharges two years later. The conversion may still be worthwhile, but it needs to be modeled, not improvised. A conversion that saves you $5,000 in future taxes but triggers $3,000 in IRMAA is a worse outcome than a slightly smaller conversion that avoids the threshold entirely.
  • Ignoring the spousal effect. If you're married and one spouse has a much larger traditional IRA, the surviving spouse will inherit the full tax burden of those forced distributions — while filing as single. Running the numbers on the widow's scenario often reveals that converting more during the gap years is worth paying for, even at slightly higher rates than you'd otherwise choose.
  • Treating all accounts the same. Roth conversions are a tax-timing decision, not an investing decision. The question is when to recognize income from the traditional account — not what to hold in either account. Keeping these distinct prevents confusion about the goal.
  • Assuming the tax law will stay the same. The 2017 Tax Cuts and Jobs Act lowered rates and widened brackets. Many of those provisions are scheduled to sunset after 2025 unless renewed. If rates rise, converting at today's rates becomes even more valuable in retrospect. This is one case where acting in the gap years rather than waiting carries a real hedge.

Keep learning →

The Roth conversion window ties together Social Security timing, RMD planning, and the widow's tax trap. Used well, these few years of planning can reduce taxes for the rest of your retirement — and protect the surviving spouse when it matters most.

This is educational content about retirement planning concepts, not personalized financial advice.