A question for HD readers about advisability of Roth conversions. Most advice revolves around future tax rates, but I've never seen advice based on the actual deferral. Suppose you were in the Fed 33% marginal tax rate in 2015, deferred the 401k max ( 59k which includes employer & catch up) then convert this to Roth in 2026. If it's done anywhere below a 33% Fed tax rate, isn't this a win regardless of future tax rates? It seems like that never is mentioned as a reason to go ahead and convert. Of course, if future rates are lower that's even better, but that doesn't negate the benefits of delaying taxes for 11 years while compounding the amount. And it's not based on future unknowns but actual data from previous transactions. Just wondering if I'm missing something in this analysis?
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A question for HD readers about advisability of Roth conversions. Most advice revolves around future tax rates, but I've never seen advice based on the actual deferral. Suppose you were in the Fed 33% marginal tax rate in 2015, deferred the 401k max ( 59k which includes employer & catch up) then convert this to Roth in 2026. If it's done anywhere below a 33% Fed tax rate, isn't this a win regardless of future tax rates? It seems like that never is mentioned as a reason to go ahead and convert. Of course, if future rates are lower that's even better, but that doesn't negate the benefits of delaying taxes for 11 years while compounding the amount. And it's not based on future unknowns but actual data from previous transactions. Just wondering if I'm missing something in this analysis?
Post: Roth Conversions and Taxes
Link to comment from August 11, 2026