Roth Conversion Strategy for Dentists: When and How Much to Convert

Roth conversions have no income limit — any dentist, at any income, can convert pre-tax retirement balances to Roth. The question isn't eligibility; it's timing. Dentists have several career-stage windows where conversions are unusually favorable, and most miss all of them.

Conversions vs. direct contributions: the key difference

A direct Roth IRA contribution phases out at $153,000–$168,000 MAGI for single filers and $242,000–$252,000 for married filers in 2026.¹ Most dentists in practice are above these limits and contribute to Roth accounts only via the backdoor Roth strategy.

A Roth conversion is different. You take money already sitting in a traditional IRA, SEP-IRA, 401(k), or similar pre-tax account and move it to a Roth account. There is no AGI cap — a dentist earning $600,000 can convert just as freely as one earning $60,000. The converted amount is added to ordinary income in the year of conversion and taxed at your marginal rate. Growth from that point forward is permanently tax-free.

The dentist income arc and why it creates conversion opportunities

Unlike a W-2 employee whose income climbs steadily, a dentist's income has several predictable gaps and inflection points:

• Dental school and residency: income near zero or resident stipend (~$60K–$75K taxable). Pre-accumulation, so no balances to convert — but this is the time to open Roth accounts through direct contributions or convert any small rollover balances at very low rates.
• Early associate years: $120K–$180K for general dentists, $180K–$300K for specialists. Often below the 32% bracket threshold. Pre-tax balances are small, but conversions here avoid the 35–37% rates they'd face in peak practice ownership years.
• Practice ownership ramp-up: income spikes to $300K–$600K+ but pre-tax balances are growing. This is typically the wrong time for large conversions.
• Pre-sale planning years: if you reduce your clinical days 18–24 months before a practice sale, practice income may temporarily drop — creating a natural conversion window.
• Post-sale / early retirement: after selling, earned income often drops dramatically. This is frequently the largest and most valuable conversion window for dentists.
• Ages 60–72 before RMDs start: no RMDs on Roth accounts. Converting pre-tax balances before RMD age reduces future mandatory taxable distributions and preserves optionality for heirs.

Fill-the-bracket strategy: 2026 thresholds

The most common conversion approach is "fill the bracket" — convert just enough to use up remaining room in your current bracket without spilling into the next one. This table shows where 2026 MFJ brackets begin:²

Example: You sell your practice in 2026. The year after the sale, you have $80,000 in interest and dividend income and no W-2 or practice income. Your taxable income after the $32,200 standard deduction is roughly $47,800. You're in the 12% bracket with room to convert up to ~$53,000 before hitting the 22% threshold. Converting $53,000 from your traditional IRA costs about $6,400 in tax — and that money grows tax-free for the rest of your life. Compare that to paying 35–37% on the same dollars as RMDs in your 70s.

The pro-rata trap: the most common Roth conversion mistake

If you have any pre-tax IRA balances (traditional IRA, SEP-IRA, SIMPLE IRA rollover), the IRS applies the pro-rata rule under IRC §408(d)(2) to all conversions. You cannot cherry-pick only after-tax dollars to convert.

Example of the trap: You have a $200,000 SEP-IRA (all pre-tax) and $0 basis. You attempt to convert $10,000 thinking you'll pay tax only on the after-tax portion. The IRS looks at all IRA balances: $200,000 pre-tax / $200,000 total = 100% of every dollar converted is taxable. The $10,000 conversion is fully taxable.

The fix for practice owners: roll all pre-tax IRA balances into your practice's solo 401(k) or employer plan before executing conversions. 401(k) balances are excluded from the pro-rata calculation. Once the IRA is empty (or contains only after-tax basis), you can convert cleanly or execute backdoor Roth contributions without the trap.

This is one of the most advisor-dependent steps in the Roth conversion sequence — the timing, the rollover mechanics, and the sequence of steps must be coordinated correctly to avoid an inadvertent taxable event.

IRMAA: the Medicare premium warning

Medicare IRMAA surcharges for 2026 are based on your 2024 MAGI. Roth conversions increase MAGI — and a large conversion in a given year can trigger IRMAA surcharges two years later.³

For dentists converting in the years immediately before Medicare eligibility (age 65), model the IRMAA impact. A $100,000 conversion that pushes you over the $274,000 threshold could cost an additional $1,944/year per person in Medicare premiums — $3,888/year for a couple for two years. That's $7,776 in premium surcharges to weigh against the conversion's tax benefit.

The 2026 Roth catch-up mandate

Starting January 1, 2026, SECURE 2.0 §603 requires that catch-up contributions to 401(k) plans by participants who are age 50 or older and earned more than $150,000 in FICA wages in the prior year must be designated as Roth contributions.⁴ This means:

• If you earned > $150,000 in FICA wages in 2025, your 2026 401(k) catch-up (up to $8,000, or $11,250 at ages 60–63) must go to Roth — there's no pre-tax option for that portion.
• Your practice's plan document must support Roth catch-up contributions; if it doesn't, catch-up contributions cannot be made at all until the plan is amended.
• This is effectively a forced partial Roth conversion inside the plan — the tax benefit is the same, but plan compliance is on the employer (you, if you're the practice owner).

When converting doesn't make sense for dentists

• Peak income years ($400K+ W-2 + practice income): you're likely in the 32–37% brackets. Converting at these rates and then withdrawing in retirement at (hopefully) lower rates is usually a losing trade.
• If you're using a cash balance plan: maximizing pre-tax deferrals via a cash balance plan while in peak earning years reduces current taxes more than most conversions would save. Don't convert while you're also making large deductible contributions.
• If you need cash within 5 years of conversion: each Roth conversion starts its own 5-year clock. Converted amounts (not earnings) are accessible penalty-free after 5 years if you're under 59½. If you might need liquidity before the clock runs, a taxable account may be better than converting.