How To Convert a Traditional IRA to a Roth after 60

You can convert an IRA to a Roth no matter how old you are. But if the conversion boosts your income, it could have taxing consequences.

Options Traditional IRA or Roth IRA retirement plans as piggy banks.
(Image credit: Getty Images)

You can’t contribute to a traditional IRA, at any age, if you don't have earned income. But can someone who is retired and age 70½ still roll over money from a traditional IRA to a Roth? Do you need to have earned income to make a successful conversion? Let's delve into those answers and find out what anyone making an IRA conversion should consider before rolling over funds to a Roth IRA.  

Who can convert a traditional IRA to a Roth IRA? 

There's no age limit or income requirement to be able to convert a traditional IRA to a Roth. You must pay taxes on the amount converted, although part of the conversion will be tax-free if you have made nondeductible contributions to your traditional IRA. 

Once the money is in the Roth, you'll be able to take tax-free withdrawals (you may have to pay taxes on any earnings withdrawn within five years of the conversion, but only after you've withdrawn contributions and converted amounts). See Roth IRA Basics: 10 Things You Must Know for more information.

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Possible financial consequences of converting a Traditional IRA

Be careful before making a big conversion in one year, however, because it can have a ripple effect on other areas of your finances. The conversion will be included in your adjusted gross income, which could bump some of your income into a higher tax bracket and could also cause you to pay more for your Medicare premiums and higher taxes on your Social Security benefits.

The Social Security Administration (SSA) determines who pays an income-related monthly adjustment amount  (IRMAA) based on the income reported two years prior. So, the SSA looks at your 2022 tax returns to see if you must pay an IRMAA in 2024

If your adjusted gross income (plus tax-exempt interest income) is more than $103,000 if you're single or $206,000 if married filing jointly, you will have to pay the Medicare high-income surcharge for Parts B and D. 

In 2024, people subject to the surcharge pay an additional $69.90 to $419.30 per person each month, depending on their income, for Medicare Part B premiums. They also pay a high-income surcharge of $12.90 to $81.00 above their Part D premiums. See Medicare Premiums 2024: IRMAA for Parts B and D for more information.

The extra income from the conversion could also increase the portion of your Social Security benefits that is subject to income taxes. See Do You Have to Pay Taxes on Social Security Benefits? for details.

Keep an eye on RMDs (required minimum distributions) the year you convert your Traditional IRA

Also, keep in mind that rolling money over from a traditional IRA to a Roth after 70½ won't reduce your RMD for the year of the conversion; the required withdrawal is based on your IRA balance as of the end of the previous year. But it can reduce your RMDs for future years. 

Instead of making one big conversion, consider rolling over a portion of the money from a traditional IRA to a Roth every year, with a close eye on the top of your tax bracket and income limits for the Medicare high-income surcharge and Social Security taxes.

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Kimberly Lankford
Contributing Editor, Kiplinger's Personal Finance

As the "Ask Kim" columnist for Kiplinger's Personal Finance, Lankford receives hundreds of personal finance questions from readers every month. She is the author of Rescue Your Financial Life (McGraw-Hill, 2003), The Insurance Maze: How You Can Save Money on Insurance -- and Still Get the Coverage You Need (Kaplan, 2006), Kiplinger's Ask Kim for Money Smart Solutions (Kaplan, 2007) and The Kiplinger/BBB Personal Finance Guide for Military Families. She is frequently featured as a financial expert on television and radio, including NBC's Today Show, CNN, CNBC and National Public Radio.

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