You may have stopped working. Your traditional IRA is still growing. RMDs have not started. Converting some of that money to Roth now could reduce the amount left in tax-deferred accounts later.
That does not automatically make a conversion a good move.
A Roth conversion can create taxable income today. That income can interact with the taxation of Social Security benefits and, for people on Medicare or approaching it, Medicare IRMAA. Meanwhile, the future tax rates and withdrawals you are trying to avoid are not known with certainty.
The question is not simply whether you can reduce future RMDs.
The question is whether paying tax on some retirement money now improves the larger retirement plan.
That is why Freedom Engine treats taxes, retirement income, Social Security and Medicare as connected decisions.
This is education, not tax, legal, investment, Social Security or Medicare advice. Your result depends on your accounts, age, filing status, income, tax basis and other circumstances.
Why people consider Roth conversions before RMDs
Traditional retirement accounts generally defer federal income tax on previously untaxed amounts until distribution.
Eventually, required minimum distribution rules can force money out of traditional IRAs and many employer retirement accounts. Those distributions are generally included in taxable income except for amounts that were previously taxed or otherwise qualify for tax-free treatment.
A Roth conversion changes the timing.
You move eligible retirement money into a Roth account and generally include the previously untaxed portion in income for the conversion year. In exchange, that money is no longer sitting in the traditional account that may later generate RMDs.
That can be useful.
It can also be expensive.
A conversion large enough to reduce future RMDs meaningfully can also create a large current tax bill. It can affect other parts of the tax return and retirement plan.
Reducing an RMD is not the same thing as reducing lifetime taxes.
When RMDs actually begin
There is no single RMD starting age that applies to every retiree.
For people born from 1951 through 1959, the applicable RMD age is 73. For people born in 1960 or later, SECURE 2.0 moves the applicable age to 75. IRS regulations implement the applicable-age framework established by SECURE 2.0.
Traditional IRA owners generally must begin RMDs based on that applicable age.
Employer retirement plans can have different timing rules. Some participants can delay RMDs until retirement if the plan permits it, while special rules apply to certain owners.
So “convert everything before 73” is not a retirement strategy.
It starts with the wrong assumption for some people and ignores everything else for everyone.
Which retirement accounts have lifetime RMDs
Traditional IRAs, SEP IRAs, SIMPLE IRAs and many employer retirement plans are subject to RMD rules.
Roth accounts work differently.
Under current law, an original owner is not required to take lifetime RMDs from a Roth IRA. Designated Roth accounts in plans such as 401(k)s and 403(b)s also are not subject to lifetime RMDs for the original owner. Beneficiaries, however, can be subject to RMD rules after the owner's death.
That does not mean a partial Roth conversion “eliminates RMDs.”
If you still have money in accounts subject to RMD rules, those accounts can still produce required distributions.
The conversion changes the balance between the two buckets. It does not repeal the rules.
What a Roth conversion actually changes
Suppose you have money in a traditional IRA and convert part of it to a Roth IRA.
The traditional IRA balance is reduced by the amount moved.
The Roth IRA receives the conversion.
The previously untaxed portion of the conversion generally becomes taxable income for that year. If the IRA includes after-tax basis, the full gross conversion is not necessarily taxable. Form 8606 is used to calculate and report the relevant amounts.
From an RMD perspective, the important point is straightforward:
Money that is no longer in the traditional IRA will not remain there to contribute to that account's future RMD calculation.
But that is only half the transaction.
The other half is the tax you created today.
A retirement plan has to evaluate both.
Can you convert your RMD to a Roth IRA?
No.
A required minimum distribution is not an eligible rollover distribution. The RMD itself cannot simply be rolled into a Roth IRA as a Roth conversion.
That does not mean Roth conversions have to stop once RMDs begin.
Roth conversions can still be possible after RMDs begin, but the required distribution itself is not eligible for rollover or conversion.
That is very different from saying you must finish every Roth conversion before RMD age.
Delaying the first RMD can put two RMDs in one tax year
The first RMD has a timing rule that can surprise people.
An IRA owner can generally delay the first required distribution until April 1 of the following year.
But the next RMD is still generally due by December 31 of that same year.
That means delaying the first distribution can result in two RMDs being received during one calendar year.
Taking the first RMD in the first year instead of delaying it can therefore avoid that bunching, although whether that is better depends on the rest of the tax picture.
Putting two taxable retirement distributions into one year can affect more than the RMD line itself. The additional income can interact with tax brackets, Social Security taxation, Medicare and other parts of the return.
“Delay it because you can” is not much of a strategy either.
The years before RMDs are not automatically low-tax years
Retirement planning loves the phrase “low-tax conversion window.”
Sometimes that window exists.
Sometimes it doesn't.
Stopping work can reduce wages, but retirement income can come from plenty of other places:
- pensions
- taxable IRA withdrawals
- dividends and interest
- capital gains
- deferred compensation
- rental or business income
- Social Security
- Roth conversions themselves
- other taxable income
Someone who retires at 65 and waits years for RMDs may have substantially less taxable income than while working.
Another retiree may not.
“Retired” is not a tax bracket.
The years before RMDs should be modeled, not automatically filled with conversions.
Social Security can change the conversion math
A Roth conversion can affect more than the tax on the conversion itself.
The taxable portion can increase adjusted gross income. AGI is part of the calculation used to determine how much of Social Security benefits is included in taxable income.
That means a conversion can potentially cause more of your Social Security benefit to become taxable.
That still does not automatically make the conversion a mistake.
It means the real cost of the conversion cannot be measured by looking at the conversion in isolation.
We break that interaction down separately in Roth Conversions and Social Security Taxes: How One Can Affect the Other.
Medicare can change the math too
Medicare uses another income calculation.
For IRMAA, Social Security generally looks at modified adjusted gross income from an earlier tax return. A taxable Roth conversion can increase that MAGI and potentially affect future Medicare Part B and Part D premiums.
The effect does not generally occur in the same calendar year as the conversion because Medicare normally uses a two-year lookback.
So a conversion that reduces future tax-deferred balances can still create another retirement cost along the way.
Our Roth Conversions and IRMAA guide explains that lag and the Medicare calculation separately.
Again, IRMAA is not a veto on Roth conversions.
It is a cost that belongs in the math.
What should you model before choosing a conversion?
Before deciding that the years before RMDs are your Roth-conversion window, the plan should answer more than “How much room is left in this tax bracket?”
At minimum, look at:
- your applicable RMD age
- traditional IRA and employer-plan balances
- after-tax basis, if any
- current taxable income
- expected retirement withdrawals
- pension income
- when Social Security will begin
- how a conversion may affect Social Security taxation
- Medicare timing and potential IRMAA
- how you will pay the conversion tax
- expected future required distributions
- filing status now and later
- what happens if one spouse dies
- beneficiary and estate objectives
Some of those inputs are known.
Others are estimates.
That is exactly why a conversion should be modeled across multiple years instead of optimized against one tax return.
RMDs are a deadline, not a Roth-conversion strategy
Required minimum distributions matter because they can force taxable retirement money out of tax-deferred accounts later.
Roth conversions matter because they let you choose to recognize some of that taxable income earlier.
Neither fact tells you how much to convert.
A large conversion could reduce future RMD exposure and still be a bad trade after current taxes, Social Security and Medicare are considered.
Doing nothing could preserve a low tax bill today and leave a much larger tax-deferred balance for later.
The answer is not “always convert.”
It is not “never convert.”
And it definitely is not “convert everything before 73.”
RMDs are a deadline in the tax code, not a Roth-conversion strategy.
The job is to coordinate current taxes, future withdrawals, Social Security, Medicare and the rest of retirement.
That is the point of Freedom Engine: retirement decisions interact.