Quick Answer: A Roth conversion before RMDs lets you pay tax on retirement savings at today’s rates instead of tomorrow’s forced rates. Your lowest-income years usually fall between retirement and age 73. Arizona’s flat 2.5% tax and Social Security exemption make that window especially valuable for Tucson retirees.
A Roth conversion before RMDs gives you control over the timing of your retirement tax bill. After age 73, that control disappears. The IRS sets a minimum amount you must withdraw and tax every single year.
Planners call the years in between the trough years. Your paycheck has stopped. Social Security may still be waiting. Your traditional IRA, however, keeps compounding toward a much larger tax bill. Tucson retirees who act during this stretch often save six figures over a lifetime.
What a Roth Conversion Actually Does
A conversion moves money out of a pre-tax account and into a Roth IRA. You report the converted amount as income this year. From that point forward, the money grows tax-free.
Qualified Roth withdrawals never face income tax again. More importantly, a Roth IRA carries no required minimum distributions during your lifetime. You choose when to touch it, or whether to touch it at all.
Income limits never apply to conversions either. High earners who cannot contribute to a Roth directly can still convert freely.
Why Does Waiting Until 73 Cost More
RMDs land on top of every other income source you already receive. Current rules start them at age 73. Anyone born in 1960 or later waits until 75.
Picture a retiree with $1.5 million in a traditional IRA at 73. The IRS Uniform Lifetime Table produces a first-year RMD near $56,600. That figure arrives on top of Social Security, pensions, and dividends.
The cost rarely stops at a higher bracket. Larger income also triggers IRMAA surcharges on Medicare premiums. It pushes more of your Social Security benefit into taxable territory. Worse, the account grows every year you wait, so each future RMD grows too.
What Makes the 2026 Window Unusual
Federal Rates Finally Stopped Moving
The One Big Beautiful Bill Act made the 10% to 37% federal brackets permanent. For years, planners had to guess about a scheduled sunset. That guessing game has ended. The question now becomes how much to convert annually, not whether to convert at all.
A New Senior Deduction Opens Space
Filers age 65 and older can claim a $6,000 federal bonus deduction through 2028. Couples where both spouses qualify claim $12,000. This deduction stacks on top of the standard deduction and the existing age-based addition.
Additional deduction creates additional room in the lower brackets. Efficient conversions live in exactly that space.
The Senior Deduction Trap Nobody Mentions
That new deduction comes with a catch worth understanding. It shrinks as your income rises. You lose 6 cents of deduction for every dollar of MAGI above $75,000 single or $150,000 joint. It vanishes entirely at $175,000 and $250,000.
A conversion increases your MAGI dollar for dollar. Therefore, an oversized conversion can wipe out the deduction that made conversions attractive. Inside that phase-out range, your true marginal rate climbs above your stated bracket.
Sizing matters more than most retirees realize. Your CPA can pinpoint the exact break point for your return. Coordinated income planning then keeps the conversion, the deduction, and your Medicare exposure working together.
How Arizona Tilts the Math Toward Tucson Retirees
Three features of Arizona law strengthen the case locally.
- A flat 2.5% income tax. Brackets never creep, so a larger conversion carries no extra state penalty. Your state cost stays predictable.
- No state tax on Social Security. Your benefits stay out of the Arizona calculation, even during a conversion year.
- No estate or inheritance tax. Roth assets reach your heirs without state estate tax, and qualified distributions arrive income tax-free.
Now compare a retiree in a progressive-tax state. A six-figure conversion there climbs through several state brackets. Arizona charges the same flat rate on the first dollar and the last.
How Much Should You Convert in a Single Year
Fill your current federal bracket, then stop. A multi-year ladder beats one large conversion nearly every time. Spreading income across several years keeps you below bracket jumps and IRMAA cliffs.
Four rules protect the strategy:
- Respect the two-year Medicare lookback. A 2026 conversion sets your 2028 Part B and Part D premiums.
- Pay the tax from outside savings. Covering the bill with IRA dollars shrinks the balance that compounds tax-free.
- Track each five-year clock. Every conversion starts its own period on earnings. Converted principal escapes the early withdrawal penalty after 59½.
- Take your RMD first after 73. You must satisfy the full distribution before converting anything extra.
How We Coordinate Conversions at Global Investment Strategies
We have built income plans for Tucson families since 2009. A conversion never stands alone in that work. It touches Social Security timing, withdrawal order, Medicare premiums, and your legacy intentions at the same time.
We work alongside your CPA and attorney instead of replacing them. They prepare the returns and draft the documents. Our role keeps every decision pointing the same direction. Our retirement planning page explains the full process.
Review Your 2026 Conversion Window
The window sits open right now, yet the conditions will shift. The senior deduction expires after 2028. Your personal trough years close the moment RMDs begin. Acting earlier simply leaves you more room to maneuver.
Families throughout Tucson, Oro Valley, Marana, and the Catalina Foothills revisit this question every fall. Request a private conversation and we will map your conversion options against your complete income picture.
Global Investment Strategies provides educational planning concepts and works alongside your qualified legal, tax, and financial professionals. This article is educational and is not individualized tax or financial advice. Review any conversion with your CPA before acting.
