Converting your traditional IRA to a Roth IRA

Learn about the potential benefits of a Roth IRA and how to take advantage of them if you have assets in a traditional IRA

It's generally a good idea for most investors to consider including a Roth IRA in their overall retirement planning. Investments in your Roth IRA have the potential to grow tax-free, which may help you save more over time. Plus, Roth IRAs don't have required minimum distributions during the lifetime of the original owner, and Roth IRA assets may pass to your heirs tax-free.

Determining if a Roth conversion is right for you

Ready to get started?

Roth Conversion Checklists
Follow these simple steps to convert your Traditional IRA or old 401(k) to a Roth IRA.

Anyone can convert their eligible IRA assets to a Roth IRA regardless of income or marital status.

For many individuals, converting to a Roth IRA may make sense. However, you should consult with a tax advisor and consider the following 4 factors prior to making your decision:

  1. Taxes: With a conversion, you pay federal income taxes now on the conversion amount, but none on any future earnings as long as when withdrawals are taken, the 5-year aging period has been met and you are age 59½ or over, disabled, or deceased. (In the event of the account holder's death, a spouse or beneficiary could make withdrawals.)
    If you think your tax rate will be higher in retirement than it is today, you may want to consider a Roth IRA conversion. If your taxable income is lower this year than in a typical year, or if you have accounts that have lost value, you may want to consider a Roth IRA conversion because you may pay less in taxes. If you plan to leave your assets to your beneficiaries, consider conversion because they may not have to pay federal taxes on that money.
  2. Time: The relative benefits of conversion will generally increase the longer your money remains in the Roth IRA. Generally, conversion may not make sense if your time horizon is less than 5 years, because if you have not met the 5-year aging requirement, any withdrawals are subject to a 10% penalty.
  3. Cost: Because you will be required to pay federal income taxes on the conversion now, you need to consider that cost and whether or not you can afford that in the current year.
  4. RMDs: There are no required minimum distributions (RMDs) from a Roth IRA during the lifetime of the original owner. If you think your tax rate will be the same or higher than your current rate when you withdraw your money, it may make sense to consider converting to a Roth IRA now.

To learn more about the differences between Roth and traditional IRAs and get a quick overview of eligibility and features, use the Compare Roth and Traditional IRAs.

It's also important to note that if you are required to take a required minimum distribution (RMD) in the year you convert to a Roth IRA, you must do so before converting.

Considerations for owners of Roth IRAs

Distributions from a Roth IRA are qualified, and thus tax-free and penalty-free, provided that the 5-year aging requirement has been satisfied and at least one of the following conditions has been met:

  • You reach age 59½
  • You pass away
  • You are disabled
  • You make a qualified first-time home purchase

All other distributions are non-qualified. Non-qualified distributions of converted balances are not taxed again (since they were taxed when converted), but they may be subjected to a 10% penalty unless it's been at least five years since the beginning of the year of your conversion, you've reached age 59½, or one of the other exceptions applies.

RMDs are not required during the lifetime of the original owner of a Roth IRA. RMD amounts are not eligible to be converted to a Roth IRA.

If you qualify, you can do an eligible rollover distribution from your old 401(k) directly to a Roth IRA. You'll owe taxes on the amount of pretax assets you roll over.

Note also, if you have assets in a Designated Roth Account (i.e., Roth 401(k)) and would like to roll these to an IRA, the assets must be rolled into a Roth IRA.

As with Traditional IRA conversions to Roth IRAs, if you are required to take an RMD in the year you roll over into an IRA, you must take it before rolling over your assets.

Learn more about your rollover options

The Tax Cuts and Jobs Act eliminated this strategy for conversions processed in the 2018 tax year and beyond.

Consult a tax professional about your particular situation.


  • What if I am 731 and need to take a required minimum distribution (RMD)?
    There are no RMDs for a Roth IRA. When converting from a Traditional IRA to a Roth IRA, you are required to satisfy your RMD before you convert.
  • What account types can I convert?

    You may be able to convert the following account types to a Roth IRA: 

    • Traditional IRA 
    • Rollover IRA 
    • SEP IRA 
    • Old 401(k) 
    • Old 403(b) 
    • Old governmental 457(b)
  • What are the potential tax implications of converting?

    You'll owe taxes on the previously untaxed amount of your IRA that's converted. But, unlike traditional IRA withdrawals before age 59½, there's no penalty involved. 

    There are a number of factors to consider to help you decide how much to convert. Consider these questions: 

    • Do you have the money set aside in a nonretirement account to pay the tax? 
    • How much can you convert without moving into a higher tax bracket? 
    • To help maximize your retirement savings, it’s generally a good idea to consider not using the amounts from your Retirement Accounts to pay the resulting tax costs. Instead, you should consider using cash or other savings held in nonretirement accounts. Using retirement account funds to pay the taxes will reduce the amount you would have available to potentially grow tax-free in your new Roth IRA. Additionally, if you are under 59½, using funds from your retirement account could result in an additional 10% tax penalty, which may significantly reduce the potential benefit of conversion.
  • How do I convert to a Roth IRA?

    Deciding whether to convert to a Roth IRA is not a simple decision. Before you begin the process, there are things you can do to prepare:

Next steps


IRA Contribution Calculator Answer a few questions in the IRA Contribution Calculator to find out whether a Roth or traditional IRA might be right for you, based on how much you’re eligible to contribute and how much you might be able to deduct on your taxes.

Roth IRA Conversion Checklists Get step-by-step instructions on how to convert to a Roth IRA from a Fidelity or non-Fidelity Traditional IRA or 401(k).