He Converted $60,000 a Year From 60 to 72 and Paid the Tax From Savings. At 73 His Neighbors Got Their First RMD Letters. He Had Nothing Left to Withdraw

Required minimum distributions (RMDs) turn a traditional IRA into a withdrawal schedule set by the government, and every forced withdrawal is taxable. A retiree who spends the decade before that schedule starts moving money into a Roth IRA can reach RMD age with no traditional balance left. The hypothetical below shows how that works, with every step of the math, and who should think hard before trying it.

How One Hypothetical Retiree Emptied His IRA Before RMD Age

Take a hypothetical single filer we’ll call Walt. From age 60 through age 72, he converted $60,000 of his traditional IRA to a Roth IRA every year. He paid the income tax from a taxable savings account. That adds up to 13 conversions: $60,000 × 13 = $780,000 moved. Assume his last conversion at 72 used up the final traditional dollars.

The law allows this. Under 26 CFR 1.408A-4, an amount in a traditional IRA may be converted to a Roth IRA. Under 26 U.S.C. § 408A(d)(3)(A)(i), the converted amount is included in gross income, and § 408A(d)(3)(A)(ii) says the early-distribution tax of section 72(t) does not apply. Once the money is in the Roth, “the RMD rules do not apply to Roth IRAs or Designated Roth accounts while the owner is alive.”

His neighbors were born on or after January 1, 1951, but before January 1, 1959, so their applicable RMD age is 73. When the IRA custodian letters arrived, Walt had no traditional balance to calculate an RMD from.

What One Conversion Year Costs Under Tax Year 2026 Rules

Here is the math for one year, using tax year 2026 figures and assuming Walt has no other taxable income. The 2026 standard deduction for a single filer is $16,100. The 10% rate applies to the first $12,400, 12% applies above that, and 22% starts above $50,400.

1. Taxable income: $60,000 − $16,100 = $43,900
2. 10% bracket: 10% × $12,400 = $1,240
3. 12% bracket: 12% × ($43,900 − $12,400) = $3,780
4. Total federal tax: $1,240 + $3,780 = $5,020, or about 8.4% of the conversion

Walt’s taxable income stays below the point where the 22% rate begins. Because he paid the tax from savings, the full $60,000 went into the Roth. If he had withheld the tax from the conversion, less money would have reached the Roth. His income is also far below the 2026 Medicare threshold of $109,000 for single filers. Above that line, IRMAA surcharges (extra Medicare premiums for higher earners) begin. Below it, he pays the standard Part B premium of $202.90 a month.

What Walt’s Neighbors Owe Instead

Now take a hypothetical neighbor with $1,000,000 in a traditional IRA at the end of the year before turning 73. The Uniform Lifetime Table divisor at age 73 is 26.5: $1,000,000 ÷ 26.5 = $37,735.85, all of it taxable. The divisor drops to 24.6 at 75 and 20.2 at 80, so each year a larger share of the balance has to come out. Missing an RMD triggers an excise tax of 25% of the shortfall. That drops to 10% if the shortfall is fixed within the correction window.

Rules That Can Derail a Conversion Plan

• Pro-rata rule: Under 26 U.S.C. § 408(d)(2), all of your IRAs count as one contract and are valued at the close of the year. Any after-tax basis is spread across every IRA you own (Roth IRAs are not included). and Form 8606 tracks it.
• No do-overs: § 408A(d)(6)(B)(iii) bars recharacterization of conversions, so a conversion can’t be undone.
• RMDs come first: Required distributions can’t be rolled over (26 U.S.C. § 408(d)(3)(E) and Treas. Reg. § 1.408A-4, Q&A-6), so once RMDs start, the required amount comes out before anything is converted.
• Calendar-year timing: Conversion distributions are taxed in the year you receive them, according to IRS Publication 17. A conversion meant for tax year 2026 has to leave the traditional IRA by year-end.
• Withdrawal ordering: When money comes out of a Roth IRA, regular contributions are treated as leaving first, then converted amounts with the taxable portion first, then earnings (Publication 590-B).

Who This Strategy Doesn’t Suit

A conversion trades a known tax bill today for an uncertain one later. The trade tends to work against people in these situations:

• No cash outside the IRA. Paying the tax from the converted money shrinks what reaches the Roth.
• Charitable givers. In tax year 2026, qualified charitable distributions (QCDs), which go straight from an IRA to a charity, of up to $111,000 are excluded from income and count toward the RMD.
• Pre-65 marketplace enrollees. Extra income from a conversion can reduce Affordable Care Act premium credits.
• Retirees expecting a lower bracket later, including people planning to move to a lower-tax state.

Conversions tend to fit retirees who have low-income years before RMDs begin and traditional balances big enough that future RMDs could push them into higher brackets or IRMAA tiers (we sized up that quiet window between the last paycheck and the first required withdrawal in a free Roth conversion guide). Heirs still benefit, though Roth beneficiaries face their own RMD rules, including the 10-year rule for most non-spouse beneficiaries.

What to Watch Before Your Next Conversion

Your birth year sets your runway. People born on or after January 1, 1960 have an RMD age of 75, two years more than Walt’s neighbors. Treasury’s broader RMD rules remain a proposed regulation, REG-103529-23. Under Announcement 2026-7, taxpayers apply a reasonable good-faith interpretation of the statute until final rules take effect. With 2027 brackets now drawing attention in conversion planning, run your numbers against the new thresholds before converting again.

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