Roth Conversion is a term for the process of transferring money from a tax-deferred account to a Roth IRA, where the growth will not be taxed. PlannerPlus members can model Roth Conversion transactions in the tool.

Use the Insights > Tax charts to look for tax planning opportunities. The bottom graph on the page shows projections for how tax brackets are filled over time. If there are years that show gaps in tax liabilities, you may have a planning window.

Step 1: Go to My Plan > Money Flows

Step 2: Open the Roth Conversions section

Step 3: Press on "Model a Roth Conversion +"

Step 4: Select the account to convert

Step 5: Enter the amount to convert

Step 6: Enter the age the account owner will be at the time of conversion

Step 7: Enter an optimistic and pessimistic rate of return for the (new) Roth conversion account. The software will create a (new, virtual) Roth conversion account. The Explorer assumes that the converted funds will grow at the same rate as the current tax deferred account, so be sure to enter the same rate of return as the source account if you want your results to match. (The virtual accounts may only be accessed when you use the Custom Withdrawal Order feature at this time.)

Step 8: Press Save

Step 9: Repeat steps 3–8 to add additional conversions

Watch the charts on the right of the page update in real-time.

I. Click on "Taxes" to see tax liability projections.

II. Notice how the Estimated Lifetime Income Tax changes with each transaction

III. Notice how the columns on the chart change with each transaction

Use the Insights > Tax charts to see how tax projections have changed.

Use the Insights > Savings charts to view ROTH Conversion Withdrawals and RMD withdrawals.
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If you would prefer to model the conversion into your current Roth account, enter the Roth Conversion as a Transfer. When you do this the converted funds will be held in the account you select.