Convert $100K to Roth: Here's the Exact Tax Bill

The direct answer: what a $100K conversion costs

Linda, 61, and Dave, 63, are married filing jointly in Ohio. They have $90,000 of taxable income before any conversion and $600,000 in a traditional IRA they want to start moving to a Roth before required minimum distributions begin. They convert $100,000 this year. Their question is the one everyone asks: how much will we actually owe?

Here is the clean version, ignoring stacking for a moment. If the entire $100,000 fell inside a single 2026 federal bracket, the tax would be:

So the headline you came for: a $100,000 conversion in the 24% bracket costs about $24,000 in federal tax and roughly $29,000 once a typical 5% state is added. That number is right as a back-of-envelope estimate. But it hides the single most expensive mistake people make with conversions — assuming the whole conversion sits in one bracket.

Why the real number is a blend, not a single bracket

A Roth conversion is included in gross income as ordinary income under IRC §408A(d)(3), and it stacks on top of your existing taxable income. It does not get its own fresh set of brackets. It fills brackets starting from wherever your income already ends.

Back to Linda and Dave. They have $90,000 of taxable income. The 2026 MFJ 22% bracket runs from $96,951 to $206,700, and the 24% bracket starts at $206,701. So the math on their $100,000 conversion is governed by one figure: how much room is left at 22% before they hit $206,700.

• Income before the conversion is $90,000. The 22% MFJ ceiling is $206,700. That leaves $116,700 of headroom inside the 22% bracket.
• The full $100,000 conversion fits inside that $116,700 of room, so it never spills into the 24% bracket. Every converted dollar is taxed at 22%.

In Linda and Dave’s specific case, the conversion stays entirely in the 22% bracket because they had so much headroom. Their federal tax on the conversion is about $22,000, plus Ohio state tax (Ohio’s top rate is 3.5% on income over $100,000, so roughly $3,500 here). That is a better outcome than the 24% estimate — precisely because the conversion never crossed into 24%.

Now flip the example. Suppose a different MFJ couple already has $180,000 of taxable income and converts $100,000. They have only $26,700 of room left at 22% ($206,700 − $180,000). The remaining $73,300 of the conversion is taxed at 24%:

Their blended marginal rate on the conversion is 23.5% — not 22%, not 24%, but a weighted average of both. This is the number that actually matters when you decide how much to convert. The lesson: your conversion cost depends entirely on where your existing income leaves off, because that is the floor the conversion builds on.

The 2026 brackets you’re stacking into

These are the 2026 federal ordinary-income brackets (per IRS Rev. Proc. 2025-32, the TCJA-rate brackets, which OBBBA made permanent as of mid-2026 — so there is no scheduled rate sunset to plan around):

Note that “income” here means taxable income — after the 2026 standard deduction of $31,500 (MFJ) or $15,750 (single). When you map your conversion onto these brackets, start from your taxable income line, not your gross pay.

The state layer most people forget

The federal number is only part of the bill. Most states tax a Roth conversion as ordinary income with no special rate, so the state adds a near-flat percentage of the full $100,000:

• No-income-tax states (9): Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington, Wyoming — the conversion costs $0 at the state level. A retiree planning a big conversion year sometimes establishes residency in one of these before pulling the trigger.
• Mid-tax states (~5%): a $100K conversion adds roughly $5,000. Georgia’s 5.39% flat tax, for example, adds about $5,390.
• High-tax states: California up to 13.3%, Oregon 9.9%, New Jersey 10.75%, New York 10.9%. In Oregon, a $100K conversion can add nearly $9,900 in state tax alone.

For Linda and Dave in Ohio, the state adds a few thousand dollars on top of their ~$22,000 federal bill. The single biggest state-level lever is when and where you convert — converting after a move to a no-tax state can save five figures on a large multi-year conversion plan.

The hidden surcharges that lift the true cost

The bracket tables understate the real marginal cost because a conversion inflates your MAGI, and several thresholds key off MAGI. These are the three that bite retirees most.

1. Net Investment Income Tax (NIIT) — 3.8%

The conversion itself is not investment income, so the converted $100,000 is never directly hit by the 3.8% surtax. But the conversion raises your MAGI, and NIIT applies the 3.8% rate (IRC §1411) to the lesser of your net investment income or the amount your MAGI exceeds $250,000 (MFJ) or $200,000 (single). If a conversion pushes your MAGI over that line, your dividends, interest, and capital gains can suddenly carry an extra 3.8% — an indirect cost the headline bracket misses.

2. IRMAA — the Medicare premium cliff

If you’re on Medicare, IRMAA (the income-related Part B and Part D surcharge) uses your MAGI from two years prior. A conversion in 2026 can raise your 2028 premiums. In 2026, the first IRMAA tier hits at single MAGI over $103,000 (MFJ over $206,000), lifting the Part B premium from $185 to $259/month per person — about $888 more per year, and another $13.70/month for Part D. It is a cliff: one dollar over the threshold triggers the full tier jump for both spouses.

3. The Social Security tax torpedo

If you’re collecting Social Security, a conversion raises your “combined income,” which can make more of your benefit taxable. Those thresholds — $32,000 and $44,000 for MFJ ($25,000 and $34,000 for single filers) — are not inflation-indexed and are easily crossed once a six-figure conversion lands on top of pension and Social Security income. The result is the “tax torpedo”: each conversion dollar can drag up to 85 cents of additional Social Security benefit into taxation, so a dollar nominally taxed at 22% can carry a real marginal rate of 40.7% (22% on the conversion dollar plus 22% on the 85 cents of newly-taxable benefit it pulls in). Converting before you claim Social Security sidesteps this entirely — one reason the early-60s gap between retirement and an age-70 claim is the prime conversion window.

For Linda and Dave, this is decisive. At 61 and 63 they have not yet claimed Social Security, so their 2026 conversion does not trip the torpedo at all. If they instead waited until both were collecting benefits at 67, the same $100,000 conversion could push tens of thousands of previously-untaxed Social Security dollars into the 22% bracket — quietly adding several thousand dollars to the bill the headline bracket never shows.

What most people miss: pay the tax from outside the IRA

The most damaging mistake is funding the tax bill with money pulled from the conversion itself. If Linda and Dave convert $100,000 but withhold $22,000 to cover the tax, only $78,000 actually lands in the Roth — and if they’re under 59½, that $22,000 is treated as a distribution that can trigger the 10% early-withdrawal penalty (IRC §72(t)) plus its own income tax.

The right structure: convert the full $100,000 into the Roth and pay the ~$24,000–$29,000 tax from a taxable brokerage or savings account. That keeps the entire $100,000 compounding tax-free, which is the whole point of converting in the first place. A conversion that shrinks the principal to pay its own tax bill loses much of its advantage.

Paying from outside accounts also means you have to satisfy the IRS’s estimated-tax rules so you don’t get hit with an underpayment penalty (IRC §6654). The safe harbor: pay in, through withholding or quarterly estimates, the lesser of 90% of this year’s total tax or 110% of last year’s tax (the 110% figure applies once your prior-year AGI tops $150,000; below that it’s 100%). A surprise $24,000 of conversion tax can blow past a household that was only paying $8,000 the year before, so most people make a fourth-quarter estimated payment by January 15 or have their employer boost withholding late in the year — withholding is treated as paid evenly across the year, which can cure an early-year shortfall that a one-time estimate cannot.

A second overlooked point: the conversion deadline is December 31 of the tax year, not April 15 (per the §408A rules). And recharacterization of a conversion was eliminated by TCJA — once you convert, you cannot undo it. So model the bracket math before you click convert, because there is no take-back.

Putting the whole bill together

Here is the full cost stack for a 24%-bracket household converting $100,000, showing why “$24,000” is the floor, not the ceiling:

The decision lever

The number that should drive your conversion is not the headline bracket — it is the blended marginal rate including surcharges. Calculate where your existing taxable income ends, add the conversion on top, and read off the weighted rate across the brackets it spans. Then layer in your state percentage, check whether the conversion crosses the NIIT, IRMAA, or Social Security thresholds, and confirm you can pay the ~$29,000 cash from a taxable account rather than the IRA.

If that all-in blended rate is lower than the rate you expect to face on the same dollars in retirement — when RMDs, a surviving spouse’s single-filer brackets, or higher future rates could push you up — the conversion wins. The single most controllable lever is sizing the conversion to stop at the top of your target bracket, so you never pay 24% on dollars you could have converted at 22% in a later year.