Tannin Capital, LLC
Clay H Young, CFA
1026 Jay Street
Suite B153
Charlotte, NC 28208
844-682-6646
704-552-1082
clayyoung@tannin.com
tannin.com
 
 




Roth IRA Conversion Calculator
Roth IRA Conversion Calculator

When you convert a traditional IRA to a Roth IRA, the taxable portion of your traditional IRA (deductible contributions and earnings) is subject to federal income tax in the year of conversion.

This calculator compares two scenarios: Scenario 1--you convert a traditional IRA; and Scenario 2--you don't convert your traditional IRA. The calculator lets you choose whether to pay the conversion taxes from the IRA assets themselves, or from other assets. If you choose to pay income taxes from other assets, the calculator also determines the amount you could have earned on those funds had you not converted (this calculation is accomplished by modeling a separate "side fund").


The current year and the conversion year are assumed to be 2022.


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1The age 71 limit is solely for calculator purposes and does not reflect any legal limits or requirements (extending the age range beyond age 71 would require modeling required minimum distributions (RMDs)).

2If you have multiple IRAs, you must pro-rate your nontaxable balance among them. The IRS provides a worksheet in Publication 590-B.

3Applies only if you elect to pay conversion taxes from other (non-IRA) assets. This is the tax rate that you estimate will apply to the side fund that you would have if you don't convert your traditional IRA to a Roth IRA (and therefore don't have to use these funds to pay conversion taxes). This tax rate may differ from the tax rate that applies to your IRAs because, depending on the investments you choose, earnings on the side fund may be eligible for capital gains or other special tax treatment (for example, income from certain municipal bonds may be tax free), while IRA earnings are generally taxed upon distribution only at ordinary income tax rates.

4 Applies only if you elect to pay conversion taxes from IRA assets.



This information was developed by Broadridge, an independent third party. It is general in nature, is not a complete statement of all information necessary for making an investment decision, and is not a recommendation or a solicitation to buy or sell any security. Investments and strategies mentioned may not be suitable for all investors. Past performance may not be indicative of future results.  Investing involves risk and you may incur a profit or a loss.  Tannin Capital, LLC does not provide legal or tax advice.  For legal or tax advice, please seek the services of a qualified professional.  This communication and the information it contains should not be interpreted as an offer by Tannin Capital, LLC to provide investment advisory services.  Please visit tannin.com for important disclosures.  Preserve Strengthen Grow® Tannin™

Prepared by Broadridge Investor Communication Solutions, Inc. Copyright 2022.