My accountant said something last March that I haven’t stopped thinking about. We were going over my tax return and he leaned back in his chair and said, “You know this is the cheapest your taxes will ever be, right?”
I didn’t know that.
He explained that I was sitting in a window—a few years between leaving full-time work and the point where Social Security, pensions, and required withdrawals from my IRA would stack up and push me into a higher bracket. A window where my income was low enough to move money from a taxable account into a tax-free one at a bargain rate.
He called it a Roth conversion. I’d heard the term. Never paid attention.
Now I do.
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01. THE GAP AND WHY IT MATTERS
When you stop working, your income drops. Maybe you’re living off savings or a pension. Social Security hasn’t started yet. And the IRS isn’t forcing you to pull money out of your IRA—that doesn’t kick in until age 73 (or 75 if you were born in 1960 or later).
That gap—from the day you retire to the day required minimum distributions begin—is the lowest tax bracket you’ll see for the rest of your life. Financial planners call them the “trough years.” Most people waste them watching TV and not thinking about taxes.
Every year you let that bracket space sit empty is money you handed to the IRS later at a higher rate.
02. HOW A ROTH CONVERSION WORKS (IN PLAIN ENGLISH)
You move money from your traditional IRA or 401(k) into a Roth IRA. You pay income tax on the amount you move—this year, at this year’s rate. After that, the money grows tax-free. Withdrawals are tax-free. And there are no required minimum distributions on a Roth. Ever.
Think of it this way. Your traditional IRA is a tax time bomb. Every dollar in it will be taxed when it comes out—either when you pull it or when the IRS makes you pull it. A Roth conversion lets you defuse that bomb now, at a rate you choose, instead of later at a rate the IRS picks.
03. THE MATH THAT CHANGED MY MIND
My accountant walked me through a real example. A married couple, both retired, with $110,000 in base income from a pension and savings. Under the 2026 tax brackets, they can convert about $60,000 to $80,000 from their IRA to a Roth and stay in the 22% bracket.
If they don’t convert, that same money stays in the IRA. By age 73, the IRA has grown. The required withdrawal pushes them into the 24% or 32% bracket—plus it may trigger higher Medicare premiums through something called IRMAA.
22%
TAX RATE NOW (TROUGH YEARS)
32%
TAX RATE LATER (WITH RMDs)
$0
ROTH RMDs (NONE, EVER)
The 2026 brackets are now permanent under the One Big Beautiful Bill Act. For a married couple filing jointly, the 22% bracket covers taxable income up to $211,400. That’s a lot of room to move money if your earned income has dropped.
04. THE TRAPS TO WATCH FOR
▸ Don’t convert too much in one year. The whole point is to fill your current bracket, not jump into the next one. If you’re in the 22% bracket with room for $70,000 before hitting 24%, convert $70,000. Not $200,000. Spread it over multiple years.
▸ Watch for IRMAA. That’s the income-based surcharge on Medicare premiums. If your conversion pushes your income above certain thresholds, your Medicare Part B and D premiums can jump by hundreds of dollars a month—two years later. The IRMAA threshold for 2026 starts at $212,000 for married couples. Stay under it or plan around it.
▸ Pay the tax from savings, not from the conversion. If you pull the tax money from the IRA itself, you’re shrinking the amount that goes into the Roth. Use cash you already have. That keeps the full conversion working for you.
▸ Know the five-year rule. Each Roth conversion has its own five-year clock before you can withdraw the converted amount penalty-free (if you’re under 59½). If you’re already over 59½, this doesn’t apply—but it’s worth knowing.
Q. My advisor has never mentioned this. Should I be worried?
A. Not necessarily. But ask them about it. Say: “Given my income right now, does it make sense to do partial Roth conversions before my RMDs start?” If they give you a clear, specific answer with numbers, great. If they wave their hand and say it’s “complicated,” get a second opinion. This isn’t complicated. It’s arithmetic. A good CPA or fee-only planner can run the projection in an hour.
Pay tax on your terms now, or pay it on the IRS’s terms later. That’s the whole decision.
05. WHAT I’M DOING ABOUT IT
I sat down with my accountant and my advisor. We looked at my bracket space. We picked a number that fills to the top of the 22% bracket without tripping IRMAA. I’m converting that amount every year for the next several years.
It’s not exciting. There’s no dramatic moment. I write a check to the IRS in April and my future self gets tax-free money for life. That’s it.
The window closes the day your income goes back up. Once Social Security starts, once RMDs kick in, the bracket space shrinks. You don’t get those years back.
My accountant was right. This is the cheapest my taxes will ever be. I’m not going to waste it.
Call your accountant. Ask about the window.
— Walter
P.S. Have you done a Roth conversion? Are you thinking about it? Or did your advisor talk you out of it? Hit reply. I want to hear what you decided and why.
Disclaimer
Please read the offering circular and related risks at invest.modemobile.com. This is a paid advertisement for Mode Mobile’s Regulation A+ Offering.
Mode Mobile recently received their ticker reservation with Nasdaq ($MODE), indicating an intent to IPO in the next 24 months. An intent to IPO is no guarantee that an actual IPO will occur.
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