Glossary
What is a Roth conversion ladder?
A Roth conversion ladder is a series of partial conversions across several years, each sized to fill a tax bracket without crossing into the next. Spreading the conversion out keeps the tax rate low, where converting everything at once would push a large amount through the highest brackets.
The window that matters usually opens the year you stop working and closes when Social Security and required distributions begin. In between, taxable income can be unusually low.
Each year you convert only enough to reach the top of a chosen bracket. Do that for several years and a large tax-deferred balance moves to Roth at a controlled rate.
Often the real ceiling is not the tax bracket but an IRMAA threshold sitting just below it, which is why the two have to be modeled together.
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