Key Takeaways
- A widowed poster in her 50s earning about $200,000 has $17,875 of room left in the 24% bracket for a Roth conversion this year, which costs $4,290 in federal tax.
- Converting to the top of the 32% bracket would move $72,325 into a Roth for $21,714 of federal tax.
- Her daughter would have to empty the inherited accounts within 10 years, and $3.5 million spread evenly over that time would reach the 35% bracket under 2026’s brackets before any paycheck is counted.
- Paying 32% now looks like the better deal for the family, and a conversion for 2026 has to be done by Dec. 31.
Most people deciding on a Roth conversion weigh their tax rate today against the rate they’ll pay in retirement. But if you’ve saved more than you’ll ever spend, the rate to beat is your heir’s.
A widow in her 50s is weighing exactly that in a post in Reddit’s r/personalfinance forum this week. She makes about $200,000 working in tech and has about $3.5 million in retirement accounts, most of it traditional. She also has about $500,000 in a brokerage account. She wrote that she has more than enough for her own retirement, so since her husband’s death she’s been planning for the money to reach her adult daughter “during her prime earning years.”
She already converts to the top of the 24% bracket each year, but “with my income that’s a pittance.” So she asked whether she should push her conversions into the 32% bracket, on the theory that her daughter would land there anyway after inheriting.
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Her room at 24% is only $17,875
Say she files single and her $200,000 is all taxable wages. Take off this year’s $16,100 standard deduction, and she has $183,900 of taxable income. Under the IRS’s 2026 brackets, the 32% rate starts above $201,775 for a single filer, which leaves her $17,875 of room at 24%. Converting that costs her $4,290 in federal tax.
Going all the way to the top of the 32% bracket, at $256,225, is a much bigger move:
| Metric | Top of the 24% bracket | Top of the 32% bracket |
|---|---|---|
| Amount converted | $17,875 | $72,325 |
| Federal tax on the conversion | $4,290 | $21,714 |
| Rate on the last dollar | 24% | 32% |
Source: IRS 2026 tax brackets and standard deduction; author’s math.
The extra $54,450 she’d convert at 32% costs $17,424, so she’d pay $21,714 between the two brackets.
Her room could be a bit bigger if some of her pay goes to pre-tax items like health premiums. Her 401(k) won’t help here, though. She wrote that she contributes the max to Roth, catch-up included, so none of it lowers her taxable wages.
Her daughter would likely pay more than 32%
Most heirs who aren’t a spouse have to empty an inherited IRA by the end of the 10th year after the owner’s death, and an adult daughter is one of them. Spread $3.5 million evenly over those 10 years, and that’s $350,000 a year of taxable withdrawals (a bit less, since some of it is already Roth). Take off the $16,100 standard deduction, and $333,900 is taxable. That’s well past the 35% line at $256,225 under 2026’s brackets, before her daughter’s own paycheck counts at all.
And that’s on today’s balance. The poster figures her money could double every 10 years, and one doubling would mean withdrawals of $700,000 a year. That alone is past the 37% line at $640,600.
So her guess that her daughter is “likely to hit the 32% bracket” looks low. Brackets will move by the time her daughter inherits, and a married daughter filing jointly would get wider ones. But a gap of three to five percentage points leaves a lot of room for error.
Waiting has a cost too
She has a real reason to hesitate. If she’s forced to retire, she expects to make about $100,000 with her pension and part of her Social Security. At that income, she’d have more than $100,000 of room below the 32% line every year, even before the standard deduction.
But she hopes to keep working as long as she can, and every year she stops at 24% leaves a bigger traditional balance to keep growing. As she put it, 20 years from now, “what I have now is going to turn into a stupid amount of money.” The bigger that pile gets, the more of it her daughter pulls out at 35% or 37%.
She can also pay the tax from her brokerage account, which holds about $500,000. That way the whole $72,325 lands in the Roth, with nothing withheld from it to cover the bill.
I’d fill the 32% bracket
If I were in her shoes, I’d convert to the top of the 32% bracket this year. Paying 32% on that extra $54,450 now to spare her daughter 35% or 37% on the same dollars later is a trade I’d make every time.
Since a Roth conversion can’t be undone, it makes sense to wait until December, once she knows her full year’s income. A year-end bonus would use up some of her room and push part of a full conversion into the 35% bracket. A conversion counts in the year it’s made, so 2026’s has to be done by Dec. 31. And if she does get pushed out of her job someday, that’s the year to convert the most, at 22% and 24%.
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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!
