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Roth Conversion Adoption Rates and Tax Savings Data: 2026

Roth Conversion Adoption Rates and Tax Savings Data: 2026

October 09, 2026

Research compiled by Journey Advisory Group | Last updated: September 2026

Roth conversions are one of the many ways investors and filers move their pre-tax money. In a Roth conversion, you move pre-tax funds from either a traditional IRA or 401(k), shifting them into a tax-free retirement arrangement known as a Roth IRA. In a Roth IRA, you generally pay ordinary income tax on the converted amount in exchange for tax-free growth and subsequent withdrawals. To help understand the exact adoption rates and tax savings data of Roth conversions, the following report was compiled from data collected in September 2026 from reliable financial sources, including the IRS SOI, Vanguard and Fidelity investor data, and the EBRI.

Roth Conversion Statistics: 2026

While complete, finalized data for the 2026 fiscal year has not yet been published by the IRS Statistics of Income (SOI), mid-year investor metrics from Fidelity’s Q1 2026 Retirement Analysis, Vanguard's 2025/2026 Break-Even Tax Rate (BETR) study, and the Employee Benefit Research Institute (EBRI) IRA Database are available to help average consumers and retirees understand the general adoption rates and tax savings associated with Roth conversions.

In general, Roth conversions result in moderate to substantial tax savings, with high or substantial savings on taxable funds being associated with Roth conversions in low income, upper-middle income, high income, and ultra-high net worth brackets. Even small conversion amounts of $4,500–$8,500 can often net significant savings. Overall, high-income professionals represent the fastest-growing sector of adapters in 2026.

Roth Conversion Statistics: 2026 Historical Data

Adjusted Gross Income (AGI) BracketAdoption RatesAverage Conversion AmountsEstimated Tax Savings
Low Income (Under $75,000)~3%–5%$4,500–$8,500High(Relative to asset size)
Middle Income ($75,000–$150,000)~8%–12%$12,000–$22,000Moderate
Upper-Middle Income ($150,000–$250,000)~18%–24%$28,000–$45,000High
High Income ($250,000–$500,000)~35%–40%$65,000–$110,000Very High
Ultra-High Net Worth (Over $500,000)~45%+$180,000+Substantial(Wealth transfer focus)

Sources: Table 11

Conversions by Age Band

Age BandEstimated Representation (% of Total Conversions)Estimated Average Annual Conversion
Under 35~15%$5,000–$7,500
35–49~25%$7,500–$25,000
50 – 59½~30%$25,000–$60,000
60–72~22%$50,000–$150,000+
73+~8%Varies Widely

Sources: Table 22

Conversions by Account Size

Account Balance BandEstimated Transaction FrequencyEstimated Average Annual Conversion
Micro-Accounts(Under $25,000)Very High(~40% of transactions)$1,000–$7,500
Emerging Portfolios($25,000–$100,000)Moderate(~25% of transactions)$5,000–$15,000
Mid-Tier Wealth($100,001–$500,000)Steady(~20% of transactions)$20,000–$50,000
Mega-Accounts($500,001–$1M+)Low Frequency/High Volume(~15% of transactions)$75,000–$200,000+

Sources: Table 33

Timing Considerations

The timing of Roth conversions often has a major impact on the conversion’s success and overall tax savings. In general, retirees can consider their conversion strategy as occurring across three distinct phases:

  • Phase 1: Early Gap Years (Ages 60–62)
  • Phase 2: High-Stakes Window (Ages 63–65)
  • Phase 3: The Countdown (Ages 66–72)

Depending on the conversion phase, seniors should ideally focus on converting certain amounts with intentional goals of filling in certain tax brackets, which will help them net the best possible savings.

Conversion Strategies in Pre-RMD Window Years

Strategy PhaseTarget Income TargetTypical Conversion AmountCore Objective
Phase 1: Early Gap Years(Ages 60–62)Fill the 12% or 22% Brackets$40,000–$85,000Reduce traditional pre-tax balances and avoid the 3.8% Net Investment Income Tax (NIIT) threshold.
Phase 2: High-Stakes Window(Ages 63–65)Cap exactly at the 24% Tier$60,000–$120,000Maximize tax bracket spacing before activating Social Security or early pensions.
Phase 3: The Countdown(Ages 66–72)Precision Bracket Filling$30,000–$75,000Defuse the “RMD Tax Bomb” to drop the future mandatory distribution baseline.

Sources: Table 44

Roth Conversions and State Taxes

State taxes play an important role in governing Roth conversions. Whenever someone executes a Roth conversion, the state in which they permanently reside on the exact date of the conversion holds the sole right to tax that income. This means that states you have previously lived in cannot tax your conversion, and neither can states you may move to in the future.

Projected conversion wealth can be heavily impacted by state tax rates, which means that it’s important to know individual state tax rates, as well as which states allow retirement exemptions or have no taxes at all. The tables below break down states with high tax rates, retirement-exempt rates, and no-tax states.

High-Tax States

StateTax Rate
CaliforniaUp to 13.30% 
HawaiiUp to 11.00%
New YorkUp to 10.90%
New JerseyUp to 10.75%
OregonUp to 9.90%
MinnesotaUp to 9.85%

Sources: Table 55

Retirement-Exempt States

StateNotes
IllinoisFully exempt qualified retirement distributions from state income tax
MississippiFully exempt qualified retirement distributions from state income tax
PennsylvaniaExempts distributions if you meet age/retirement requirements
IowaExempts retirement income (including conversions) up to $6K Single/$12K MFJ for residents aged 55+

Sources: Table 66

No-Tax or Repealed I&D Tax States

StateNotes
AlaskaNo State Income Tax
FloridaNo State Income Tax; $0 State Tax on any Roth Conversion Amount
NevadaNo State Income Tax
New HampshireNo Income Tax on Wages (Dividends/Interest Tax Eliminated in 2025)
South DakotaNo State Income Tax
TennesseeNo Income Tax on Wages or Retirement Income
TexasNo Tax; $0 State Tax
WashingtonNo Income Tax on Traditional IRA Distributions
WyomingNo State Income Tax

Sources: Table 77

How To Plan Your Roth Conversions

Planning one or more Roth conversions requires a good amount of strategic thinking, but making a proper plan doesn’t have to be overwhelming. Here are a few general tips to follow:

  • Target the Gap Years: Execute conversions after retirement but before your Required Minimum Distributions (RMDs) begin (usually around 73-75), or before filing for Social Security.
  • Fill Tax Brackets: Convert specific amounts yearly to fill lower marginal tax brackets and avoid higher-income brackets with different rates.
  • Use Down Markets: Consider converting when asset values drop so that you can pay taxes on a lower account balance while earning tax-free growth on the recovery.
  • Watch Out-of-Pocket Costs: Avoid thresholds that trigger higher Medicare premiums (IRMAA) and Social Security benefits taxes.
  • Remember the Five-Year Rule: Withdrawals of converted principal are tax-free immediately; earnings require a five-year holding period and must follow age rules.

Strategic Rules for Cross-State Relocation

Because state income taxes also affect your Roth conversion savings, here are some general rules for cross-state relocation:

  • Delay major conversions when moving from high-tax to low-tax states and wait until your new residency is legally established (i.e., driver's license, voter registration).
  • Front-load conversions aggressively when moving from low-tax to high-tax states to lock in lower rates.
  • If you are an upper-middle-class or high-net-worth filer, watch out for spikes in your Modified Adjusted Gross Income (MAGI) that can cause you to lose your federal SALT deduction and increase your federal tax rate.

References

1Table 1:

  1. Q1 2026 Retirement analysis | About Fidelity. (n.d.). About Fidelity. https://about.fidelity.com/data-and-insights/q1-2026-retirement-analysis
  2. Cassell, K. M. (2026, July 14). Roth conversion strategy in the new tax era | Serving those who serve. Serving Those Who Serve |. https://www.stwserve.com/roth-conversion-strategy-in-the-new-tax-era/
  3. Randall, T. (2026, August 3). Roth Conversion Rules 2026: Complete guide for financial advisors. Stonewood Financial. https://www.stonewoodfinancial.com/roth-conversion-rules-2026/
  4. Fitzpatrick, J. (2026, April 16). Roth Conversion Strategy: The Advisor’s Complete 2026 Guide. Income Lab. https://incomelaboratory.com/roth-conversion-strategy-2026-guide/
  5. Lee, M. (2026, February 17). Roth IRA conversions gain traction as Gen X ages. Should you convert? USA TODAY. https://www.usatoday.com/story/money/personalfinance/2026/02/13/roth-ira-when-to-convert/88586278007/
  6. Ginsberg, M. (2026, August 27). Roth Conversion Cost Analysis: 2026 Break-Even Guide. Ginsberg Financial Strategies. https://ginsbergfs.com/blog/roth-conversion-cost-analysis/
  7. Partners, M. (2026, May 29). 6 Roth conversion Traps Retirees are missing in 2026 (And how to avoid them). Madison Partners. https://www.themadisonpartners.com/6-roth-conversion-traps-retirees-are-missing-2026/
  8. User, G. (2026, June 23). Your guide to Roth conversions in 2026 — VestGen. VestGen. https://www.vestgen.com/blog/your-guide-to-roth-conversions-in-2026
  9. Saxon, R. (2026, July 20). Roth Conversion Strategy 2026: A Guide for Ages 65–70. Saxon Financial Group. https://www.saxonfinancialgroup.com/roth-conversion-strategy-2026/

2Table 2:

  1. Q1 2026 Retirement analysis | About Fidelity. (n.d.). About Fidelity. https://about.fidelity.com/data-and-insights/q1-2026-retirement-analysis
  2. Leeney, K. (2026, February 18). One demographic really likes roth conversions. Infinium Investment Advisors, LLC. https://infiniumadvisors.com/retirement/one-demographic-really-likes-roth-conversions/
  3. Fitzpatrick, J. (2026, April 16). Roth Conversion Strategy: The Advisor’s Complete 2026 Guide. Income Lab. https://incomelaboratory.com/roth-conversion-strategy-2026-guide/
  4. Craig Copeland. (2020). IRA contribution, withdrawal, and asset allocation behavior by age. In EBRI Issue Brief. https://www.ebri.org/docs/default-source/infographics/65_ig.ira2017.12nov20.pdf?sfvrsn=11593a2f_4
  5. By The Currency editors. (n.d.). Average IRA balances by age: Traditional & Roth. Empower. https://www.empower.com/the-currency/money/average-ira-balances-age-traditional-roth

3Table 3:

  1. Q1 2026 Retirement analysis | About Fidelity. (n.d.). About Fidelity. https://about.fidelity.com/data-and-insights/q1-2026-retirement-analysis
  2. Umpierrez, A. (2026, August 6). 401(k) Millionaires Count Declines as Retirement Balances Slip in Q1   401(K) Specialist. https://401kspecialistmag.com/401k-millionaires-count-declines-as-retirement-balances-slip-in-q1/
  3. Delozier, J., & Automation, H. (2026, May 28). Fidelity data shows record retirement savings, rising Roth adoption. HousingWire. https://www.housingwire.com/articles/fidelity-data-shows-record-retirement-savings-rising-roth-adoption/
  4. Vanguard. (2026, July 16). How America Saves 2026: 25th Edition. https://workplace.vanguard.com/insights-and-research/report/how-america-saves-2026.html
  5. Fitzpatrick, J. (2026, April 16). Roth Conversion Strategy: The Advisor’s Complete 2026 Guide. Income Lab. https://incomelaboratory.com/roth-conversion-strategy-2026-guide/
  6. Roth Conversion Decision Framework: When to Convert and How Much. (2026). Institute of Business & Finance. https://icfs.com/specialists-desk/roth-conversion-decision

4Table 4:

  1. Q1 2026 Retirement analysis | About Fidelity. (n.d.). About Fidelity. https://about.fidelity.com/data-and-insights/q1-2026-retirement-analysis
  2. Vanguard. (2026, July 16). How America Saves 2026: 25th Edition. https://workplace.vanguard.com/insights-and-research/report/how-america-saves-2026.html
  3. Employee Benefit Research Institute. (n.d.). https://www.ebri.org/

5Table 5:

  1. Landsberg, R., & Palmer, E. (2025, April 15). 3 things to keep in mind when considering a Roth IRA conversion. Plante Moran. https://www.plantemoran.com/explore-our-thinking/insight/2023/06/three-things-to-keep-in-mind-when-considering-a-roth-ira-conversion
  2. Randall, T. (2026, August 3). Roth Conversion Rules 2026: Complete guide for financial advisors. Stonewood Financial. https://www.stonewoodfinancial.com/roth-conversion-rules-2026/
  3. Rae, D. (2025, March 18). Don’t Forget About State Taxes When Making Roth Conversions. Forbes. https://www.forbes.com/sites/davidrae/2025/03/18/dont-forget-about-state-taxes-when-making-roth-conversions/
  4. Daniel. (2026, April 1). Roth IRA Conversion Tax by State 2026: State Tax on Conversions & Timing Strategy. CountryTaxCalc. https://www.countrytaxcalc.com/tax-guides/usa/roth-ira-conversion-tax-by-state-2026/
  5. Roth IRA conversion: 7 things to know. (2026, May 11). https://www.fidelity.com/viewpoints/retirement/roth-ira-conversion-after-50
  6. What you should know about Roth conversions in 2026 and beyond. (2023, October 21). https://www.thriveretire.com/blog/roth-conversion-2026

6Table 6:

  1. Landsberg, R., & Palmer, E. (2025, April 15). 3 things to keep in mind when considering a Roth IRA conversion. Plante Moran. https://www.plantemoran.com/explore-our-thinking/insight/2023/06/three-things-to-keep-in-mind-when-considering-a-roth-ira-conversion
  2. Randall, T. (2026, August 3). Roth Conversion Rules 2026: Complete guide for financial advisors. Stonewood Financial. https://www.stonewoodfinancial.com/roth-conversion-rules-2026/
  3. Rae, D. (2025, March 18). Don’t Forget About State Taxes When Making Roth Conversions. Forbes. https://www.forbes.com/sites/davidrae/2025/03/18/dont-forget-about-state-taxes-when-making-roth-conversions/
  4. Daniel. (2026, April 1). Roth IRA Conversion Tax by State 2026: State Tax on Conversions & Timing Strategy. CountryTaxCalc. https://www.countrytaxcalc.com/tax-guides/usa/roth-ira-conversion-tax-by-state-2026/
  5. Roth IRA conversion: 7 things to know. (2026, May 11). https://www.fidelity.com/viewpoints/retirement/roth-ira-conversion-after-50
  6. What you should know about Roth conversions in 2026 and beyond. (2023, October 21). https://www.thriveretire.com/blog/roth-conversion-2026

7Table 7:

  1. Landsberg, R., & Palmer, E. (2025, April 15). 3 things to keep in mind when considering a Roth IRA conversion. Plante Moran. https://www.plantemoran.com/explore-our-thinking/insight/2023/06/three-things-to-keep-in-mind-when-considering-a-roth-ira-conversion
  2. Randall, T. (2026, August 3). Roth Conversion Rules 2026: Complete guide for financial advisors. Stonewood Financial. https://www.stonewoodfinancial.com/roth-conversion-rules-2026/
  3. Rae, D. (2025, March 18). Don’t Forget About State Taxes When Making Roth Conversions. Forbes. https://www.forbes.com/sites/davidrae/2025/03/18/dont-forget-about-state-taxes-when-making-roth-conversions/
  4. Daniel. (2026, April 1). Roth IRA Conversion Tax by State 2026: State Tax on Conversions & Timing Strategy. CountryTaxCalc. https://www.countrytaxcalc.com/tax-guides/usa/roth-ira-conversion-tax-by-state-2026/
  5. Roth IRA conversion: 7 things to know. (2026, May 11). https://www.fidelity.com/viewpoints/retirement/roth-ira-conversion-after-50
  6. What you should know about Roth conversions in 2026 and beyond. (2023, October 21). https://www.thriveretire.com/blog/roth-conversion-2026

How To Plan Your Roth Conversions:

  1. How to convert a traditional IRA to a Roth IRA | Vanguard. (n.d.). https://investor.vanguard.com/investor-resources-education/iras/how-to-convert-traditional-ira-to-roth-ira
  2. Adams, H. (2026, August 5). What is a roth conversion? rules, taxes, and more. Schwab Brokerage. https://www.schwab.com/learn/story/why-consider-roth-ira-conversion-and-how-to-do-it
  3. Fitzpatrick, J. (2026, April 16). Roth Conversion Strategy: The Advisor’s Complete 2026 Guide. Income Lab. https://incomelaboratory.com/roth-conversion-strategy-2026-guide/
  4. Roth conversion. (n.d.). Fidelity Investments. https://www.fidelity.com/retirement/roth-conversion
  5. Cutler, D. (2025, April 8). When to Do a Roth Conversion. EP Wealth Advisors. https://www.epwealth.com/blog/when-to-do-a-roth-conversion
  6. Rae, D. (2025, March 18). Don’t Forget About State Taxes When Making Roth Conversions. Forbes. https://www.forbes.com/sites/davidrae/2025/03/18/dont-forget-about-state-taxes-when-making-roth-conversions/
  7. Daniel. (2026, April 1). Roth IRA Conversion Tax by State 2026: State Tax on Conversions & Timing Strategy. CountryTaxCalc. https://www.countrytaxcalc.com/tax-guides/usa/roth-ira-conversion-tax-by-state-2026/
  8. Roth IRA conversion: 7 things to know. (2026, May 11). https://www.fidelity.com/viewpoints/retirement/roth-ira-conversion-after-50
  9. What you should know about Roth conversions in 2026 and beyond. (2023, October 21). https://www.thriveretire.com/blog/roth-conversion-2026