Is a Roth conversion worth it if I have a year with low income?

A low-income year is often the ideal time to convert pre-tax IRA money to Roth. Because a conversion is taxed as ordinary income, doing it when you're in a lower bracket – say after retiring early, between jobs, or during a sabbatical – means you pay less tax to move the money into tax-free territory forever. The strategy is to convert just enough to 'fill up' a low bracket without spilling into the next one. This permanently shrinks future required minimum distributions and the taxes your heirs would owe. Watch the side effects: a conversion raises your AGI, which can affect ACA health-insurance subsidies, Medicare premiums, and Social Security taxation. Pay the conversion tax from outside funds, not the IRA itself, to keep the full balance growing. Model brackets at wealthserene.com/tools/roth-conversion.