Clear Money Guide
What this guide covers
A quick view of the questions and evidence developed below.
Updated July 28, 2026. Quick answer: Aid formulas weigh income far more heavily than assets, and a conversion is income. Converting during a year that feeds an aid assessment can reduce aid by more than the tax costs — and retirement accounts themselves are generally not counted as assets.
The asymmetry that decides it
Retirement accounts are generally excluded from the asset side of aid formulas. But a conversion shows up as income, which is assessed at a much higher rate than assets are.
So a conversion converts an invisible asset into visible income — the worst possible direction for a family seeking aid.
Which years count is the whole question, and the answer has changed with aid-formula reform. Confirm the assessment years for your child’s cohort before planning around them — this page deliberately does not state a year offset that has moved more than once.
The sequencing that usually works
Convert before the first assessed year, or after the last one. For a family with a single child that is a manageable gap; with children spaced several years apart it can close the window for the better part of a decade — which is worth knowing before you assume the pre-Social-Security years are freely available.
Optional next step
Want help planning a Roth conversion?
Ask an adviser how the tax cost here fits your retirement and tax-bracket plan.
- No fee to request a match
- No obligation to hire
Expect questions about your situation, your name, email and phone, and phone verification by text. A match is not guaranteed.
The form is run by Kapitalwise, our advisor-matching partner. Kapitalwise sends your details to advisers who pay for the introduction, so expect calls and texts. Clear Money Guide is paid when you submit the form, whether or not you ever hire anyone. This is free to you and there is no obligation to hire anyone.
Opens here. Nothing loads and nothing reaches Kapitalwise until you press the button.
How our partner relationships workSources
IRC §408A (Roth IRAs); IRC §408A(d)(3); IRC §402(c)(11) (inherited plan amounts); IRC §170 (charitable deduction); IRC §172 (net operating losses); SECURE Act (2019) and final RMD regulations published 19 July 2024. Cross-checked July 2026 against professional analyses. Indexed thresholds, aid formulas and state Medicaid rules are described rather than asserted — they change annually and by state.
This states what the cited authority says. It is not tax advice.
Related
An aid formula that weighs income makes this a ceiling problem: the useful figure is how much conversion fits under the income level you are trying not to exceed. The Roth conversion guardrail estimator takes that ceiling and your income before the conversion and returns the room beneath it, with the estimated tax on using it. Its optional cap field is labelled for Medicare’s IRMAA, but it is simply a ceiling you set.