A 63-Year-Old’s $600,000 401(k) Roth Conversion Plan Saves Tens of Thousands in Taxes Before RMDs Hit

4 hours ago 3

Marc Guberti

Sat, July 18, 2026 astatine 2:43 PM CDT 5 min read

Quick Read

Converting $600,000 successful $75,000 yearly Roth IRA slices locks successful sub-22% taxation rates earlier RMDs stack with Social Security astatine 73.
Spreading conversions beneath the $218,000 IRMAA threshold avoids Medicare surcharges reaching $6,900 per person, since immoderate overage triggers the afloat cliff penalty.
Delaying Social Security to 70 adds 8% yearly to the payment portion keeping taxable income low, maximizing Roth conversion headroom during the window.
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A 63-year-old mates with $1.5 cardinal successful a accepted 401(k) and nary earned income has conscionable entered the astir invaluable taxation readying model of their lives. From present until property 73, erstwhile required minimum distributions begin, they get to determine precisely however overmuch taxable income to amusement each year. Most radical capable that model with a fewer tiny IRA withdrawals and a delayed Social Security claim. That determination costs tens of thousands of dollars successful avoidable taxes.

A focused older mates sits astatine a table, reviewing fiscal documents and a laptop. The man, with a grey beard and glasses, wears a grey sweater and holds up a document, pointing astatine it. The woman, with abbreviated grey hair, wears a bluish button-up garment and points astatine a papers connected the table. A achromatic textured mug is successful the foreground adjacent to the laptop, which displays a spreadsheet oregon list. The inheritance is simply a blurred home mounting with a achromatic door.

The strategy: person astir $75,000 a twelvemonth from the accepted 401(k) to a Roth IRA implicit 8 years. Total moved: $600,000. Done right, the taxation measure connected that $600,000 lands good beneath what the IRS volition extract erstwhile RMDs stack connected apical of Social Security aft 73.

Filling the 12% and 22% Brackets connected Purpose

For a joined mates filing jointly successful 2026, the modular deduction is $32,200. The 12% bracket runs to $100,800 of taxable income, and the 22% bracket runs to $211,400. A mates with nary different income tin person astir $133,000 and enactment wholly wrong 12%, oregon person $243,600 and enactment wrong 22%.

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Let RMDs stack connected apical of 2 Social Security checks aft property 73, and the aforesaid mates often pushes income into the 24% bracket, which starts astatine $211,400 for associated filers and runs to $403,550. The marginal complaint is lone 2 points higher, but the surcharges attached to that bracket are worse than they look connected paper.

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