Key Takeaways
- The IRS’s $6,000 deduction for seniors runs only from 2025 through 2028, and it gives retirees 65 and older more room to convert traditional IRA money to a Roth at low tax rates.
- At 2026 figures, a hypothetical single 65-year-old with no other taxable income can convert $72,500 and owe $5,800 in federal income tax, with no dollar taxed above 12%.
- Repeated each year through 2028 at 2026 figures, that moves $217,500 into a Roth for $17,400 in federal tax.
- Any other taxable income shrinks the room dollar for dollar, and the 2027 and 2028 limits will shift once the IRS adjusts them for inflation.
Take a hypothetical 65-year-old who has just retired, is single, is living on cash savings, and is holding off on Social Security. Their taxable income for 2026 could be close to zero.
That sounds like a quiet tax year. With a traditional IRA in the picture, it’s an opening that lasts only three more years.
A deduction with an end date
According to the IRS, from 2025 through 2028, anyone 65 or older can take an extra $6,000 deduction, or $12,000 for a married couple when both spouses qualify. It phases out once modified adjusted gross income (MAGI) passes $75,000, or $150,000 for joint filers.
That deduction stacks on top of the standard deduction, which the IRS set at $16,100 for single filers in 2026. Together they take the first $22,100 of income off the top before any tax applies.
Then come the brackets. In its 2026 inflation adjustments, the IRS taxes a single filer’s first $12,400 of taxable income at 10% and income up to $50,400 at 12%. The rate jumps to 22% after that.
A Roth conversion counts as ordinary income in the year it’s made. So for our retiree, the goal is simple: convert enough to fill the 12% bracket, and stop there.
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The math on $72,500
These are the steps for a single filer whose only income is the conversion:
- Convert $72,500 from the traditional IRA to a Roth.
- Subtract the $16,100 standard deduction and the $6,000 senior deduction, which leaves $50,400 of taxable income, the top of the 12% bracket.
- The first $12,400 is taxed at 10%, which comes to $1,240.
- The next $38,000 is taxed at 12%, which comes to $4,560.
The total federal bill is $5,800. That’s 8% of the money converted, a rate most savers would happily lock in on money that never gets taxed again.
The $72,500 also keeps MAGI under the $75,000 line where the senior deduction starts to shrink, so the full $6,000 counts.
The senior deduction alone is worth real money here. Without it, the same $72,500 conversion would leave $56,400 taxable, and the extra $6,000 would be taxed at 22%. The bill would come to $7,120, or $1,320 more.
Do that in 2026, 2027 and 2028, and at 2026 figures the retiree moves $217,500 into a Roth for $17,400 in total.
A married couple, both 65 or older and filing jointly, get double the room:
| 2026, federal | Single | Married, both 65+ |
|---|---|---|
| Standard deduction | $16,100 | $32,200 |
| Senior deduction | $6,000 | $12,000 |
| Top of the 12% bracket | $50,400 | $100,800 |
| Conversion that fills it | $72,500 | $145,000 |
| Federal tax | $5,800 | $11,600 |
The couple’s $145,000 stays under the $150,000 joint limit, so their full $12,000 deduction holds too.
Getting it done
Most retirees have some other income, and every dollar of it comes out of the room first. A $10,000 pension leaves $62,500 to convert inside the 12% bracket. A year of interest and dividends does the same, a smaller dollar for dollar.
How the tax is paid matters too. Paying the $5,800 from cash keeps the whole $72,500 in the Roth. Withholding it from the conversion leaves less money growing tax-free.
Timing is the third choice. A conversion counts toward the year it’s made, so each year’s has to be finished before that year ends, and the senior deduction applies only through 2028.
There’s a small cushion built in. The 12% bracket fills at $72,500, while the senior deduction’s phase-out starts at $75,000. A retiree who isn’t sure of their final income can convert a little less and keep the 22% rate out of reach.
Three years, then it’s gone
I think this is one of the better tax deals a new retiree will see. A retiree with a lean income year and a traditional IRA can move a lot of money at 12% or less, with the senior deduction doing $6,000 of the work each year.
The exact figures will move. The IRS adjusts brackets and the standard deduction for inflation each year, as it did for 2026 in October 2025, so the 2027 and 2028 room will differ from $72,500. Unless Congress extends it, the $6,000 senior deduction ends after 2028.
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Disclaimer:
Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any of the stocks mentioned. Thank you for reading, and happy investing!
