Key Takeaways
- A partial conversion converts only part of your pre-tax IRA — spreading the tax across years.
- It lets you fill tax brackets year by year instead of spiking income once.
- Multi-year partial conversions are the core of the Roth conversion ladder.
Why Partial Beats All-Or-Nothing
Most people convert nothing because the full tax bill feels too big, or convert everything in one year and pay a fortune. A partial conversion splits the difference: convert $20,000-$30,000 per year for several years, filling your lower tax brackets each year instead of spiking into the 32% or 35% bracket once. Consider a $300,000 Traditional IRA: converting it all in one year in the 32% bracket costs roughly $96,000 in tax. Converting $60,000 a year for five years from a lower base of income might cost $55,000-$65,000 total — a five-figure saving, plus the converted dollars start compounding tax-free earlier. The strategy also smooths IRMAA exposure, since each year's conversion stays under the surcharge thresholds.
How to Size the Annual Amount
- Project your other income for the year (wages, interest, dividends, pensions).
- Identify your target marginal rate — often the top of the 12% or 24% bracket.
- Convert up to the bracket ceiling, leaving room for unexpected income.
- Divide the remaining IRA balance by your planned conversion years to sanity-check the timeline.
- Reassess each year — tax law, income, and rates all change.
The Risks of Stretching It Out
- Tax rates can rise — if Congress raises rates mid-ladder, later conversions cost more.
- RMDs arrive regardless — at 73 (75 if born 1960+) you must take RMDs, and converting after RMDs start gets messy (RMDs cannot be converted).
- Market movements — a bull market increases the balance you still must convert; a bear market is an opportunity to convert more cheaply.
- Behavioral risk — multi-year plans get abandoned; automate the annual conversion like a bill.
Action Steps
- Map your current and projected tax brackets for the next five years.
- Pick the annual conversion amount that fills, but never blows through, your target bracket.
- Convert in December once your year-end income is known — or in January for the coming year.
- Track each conversion's five-year clock separately.
Worked Example: The Five-Year Plan
Priya, 58, single, plans to retire at 62. She has a $350,000 Traditional IRA, no pension, and expects retirement income around $40,000 per year — which keeps her in the 12% bracket (up to roughly $48,000 of taxable income in 2026 after the standard deduction). Her five-year plan: convert about $30,000 per year from 58 to 62 — $15,000 of each conversion fills the 12% bracket space above her expected retirement income, keeping every conversion dollar in the 12% bracket. Total converted: $150,000 at roughly 12% — about $18,000 of tax over five years. The remaining $200,000 stays Traditional, generating modest RMDs at 73. The alternative — converting all $350,000 at 62 in one year — would cost over 30% on much of the balance. Pacing the conversions across the low-income years between work and RMDs is the entire game, and it is a game anyone can play with a spreadsheet and five years of patience.
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Use the Calculator →Building a Multi-Year Conversion Plan
A partial conversion strategy works best as a deliberate multi-year plan. Start by mapping your future tax brackets — if you expect income to drop for the next three years, convert just enough each year to fill the lower brackets without spilling into the next one. Example: a married couple with $80,000 of income has roughly $110,000 of headroom in the 12% bracket for 2026 — converting $40,000 per year for three years moves $120,000 into Roth at 12%, saving $12,000+ versus converting it all at 22%. Reassess annually: tax law changes, income changes, and market moves (converting during a market dip converts more shares for the same tax) all shift the calculus. Keep records of each conversion's basis and date — the five-year clock runs separately for each. A partial conversion also keeps your taxable income low enough to avoid Medicare premium surcharges (IRMAA) and Net Investment Income Tax.