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Starting required minimum distributions does not automatically rule out Roth conversions, according to financial and estate-planning experts cited by Kiplinger. A retiree may consider limited annual conversions after taking the RMD, while weighing tax brackets, Medicare premium surcharges and other ways to plan for heirs.
A retiree who is already taking required minimum distributions from a traditional IRA has not necessarily missed the chance to convert some of the remaining balance to a Roth IRA, according to estate-planning executive Al Kingan, quoted in a Kiplinger report. But the conversion amount may need to be limited because it can add taxable income, potentially raise Medicare premiums and affect how much heirs owe later.
Federal rules require an IRA owner to take their RMD before converting additional funds from that traditional IRA to a Roth. The required distribution itself cannot be converted. After taking it, the owner can consider converting some additional money, with the taxable amount generally adding to income for that year. The report presents filling up the retiree’s existing tax bracket as one possible way to set an annual limit, rather than treating a full conversion as the only option.
Kingan says a measured, partial conversion may be worth considering, depending on the retiree’s tax bracket and Medicare costs. The report offers $50,000 a year as a hypothetical amount that might fit without pushing the reader into a higher bracket; it is not a recommendation or a figure that applies to every taxpayer. Roth conversions can also affect income calculations used for Medicare’s income-related monthly adjustment amounts, or IRMAAs, which may increase premiums.
The report describes alternatives for money the retiree does not need to spend. Kingan says investing excess RMD proceeds in a taxable account may give heirs flexibility: inherited taxable investments generally receive a basis adjustment at death, though later appreciation may be taxable. He also points to qualified charitable distributions (QCDs), which can send IRA money directly to eligible charities and reduce adjusted gross income when requirements are met. The report cites a $111,000 QCD limit for 2026; eligibility and the applicable limit should be checked for the relevant tax year.
Balancing Conversion Taxes and Heirs’ Costs
The decision matters because a large traditional IRA can create tax costs in retirement as well as after death. RMDs are taxable income, and larger distributions may affect both the retiree’s tax bill and Medicare premiums. Converting some funds can move future investment growth into a Roth account, but the conversion itself may increase current taxable income. The benefit depends on the person’s circumstances, including current and future tax rates, life expectancy, other income and ability to pay conversion taxes from funds outside the IRA.
Inheritance rules add another consideration. The report says most non-spouse beneficiaries must empty an inherited IRA within 10 years, which can concentrate taxable withdrawals during years when beneficiaries may already have high earnings. That does not mean a Roth conversion is automatically better: conversions can be costly, and beneficiaries’ tax positions differ. Kingan suggests coordinating which assets go to which heirs, potentially leaving traditional IRA funds to beneficiaries in lower tax brackets and Roth or taxable assets to those in higher brackets. Those are planning possibilities, not guaranteed tax outcomes.
QCDs may help some retirees support charities while reducing income counted for tax purposes, potentially leaving more room for a partial conversion. Life insurance is another option raised by Charles Czajka, founder of Macro Money Concepts, who says a death benefit could help heirs pay taxes on inherited retirement assets. Insurance costs, underwriting and policy terms matter, so the article does not establish that this approach will suit every retiree.
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Why RMDs Change Roth Planning
Roth conversions are often planned over several years, when an account owner can spread taxable income across multiple tax years and choose amounts with their broader income picture in mind. Once RMDs begin, the owner must first withdraw the annual required amount, narrowing the amount available for conversion without adding further income. The Kiplinger reader is 75, has a large traditional IRA and is already taking RMDs; the question is whether the tax and Medicare costs leave any practical opening for conversion.
The report’s answer is not that a large balance should be converted all at once. Kingan says the retiree may have to accept that a full conversion is no longer practical and consider smaller annual amounts. Any plan would need to account for the year’s RMD, other taxable income, federal and state tax rules, and Medicare’s income-related premium calculations. The report also raises beneficiary allocation, charitable giving and taxable investing as options that can be considered alongside a conversion.
“I would not say that this person missed a Roth conversion opportunity.”
— Al Kingan, JD, estate and business planning executive with MassMutual, quoted by Kiplinger
Costs Depend on Each Tax Return
The report does not provide the reader’s full financial details, including annual RMD amounts, other income, filing status, state of residence, account basis or beneficiaries’ tax brackets. Without those figures, it is not possible to determine whether a conversion would raise the reader’s tax rate or Medicare premiums, or to calculate a suitable amount. The $50,000 example is illustrative, and the QCD limit cited is specific to 2026.
Tax rules and Medicare premium thresholds can change, and QCD eligibility and reporting requirements depend on individual circumstances. The report also does not compare the costs and terms of any life insurance policy or establish how a proposed division of assets would affect a particular estate. Those questions require individual review using current rules and the account owner’s complete financial information.
Review This Year’s RMD and Income
The immediate planning step is to confirm the year’s RMD and take it before making any Roth conversion from the IRA. The retiree can then model possible conversion amounts against projected taxable income, marginal tax brackets and the income figures that affect Medicare premiums. A tax professional or financial planner can compare a partial conversion with alternatives such as a QCD, investing unneeded distributions in a taxable account, insurance or allocating assets among beneficiaries.
Any decision should be revisited as income, tax rules, Medicare thresholds and family circumstances change. The report gives no conversion deadline or individualized recommendation for the reader; it frames the choice as an annual planning question, not a single all-or-nothing decision.
Key Questions
Can I convert money to a Roth IRA after RMDs begin?
Yes, the report says a retiree may convert additional traditional IRA money after taking the year’s RMD. The RMD itself cannot be converted, and the added conversion amount can create taxable income.
Will a Roth conversion increase my Medicare premiums?
It may. Conversion income can affect the income calculation used for Medicare IRMAAs, but the result depends on the person’s total income and applicable thresholds.
Is converting $50,000 a year a good strategy?
The report uses $50,000 only as an example of a possible annual amount. A suitable figure depends on the retiree’s RMD, other income, tax bracket, Medicare costs and financial goals.
What can I do with RMD money I do not need?
The report discusses investing it in a taxable account, making eligible direct charitable transfers through a QCD, or considering other estate-planning options. Each has different rules and tax effects that depend on individual circumstances.
Do heirs have to withdraw an inherited traditional IRA?
The report says most non-spouse beneficiaries must empty an inherited IRA within 10 years. The tax impact depends on the beneficiary’s circumstances and the account type; readers should verify the rules that apply to their inheritance.
Source: kiplinger.com
