Picture the second week of November. Your mom, Rosa, is 67. Her tax preparer mentioned, almost in passing, that she could move some money from her IRA into a Roth before December 31. Her bracket looks roomy, and you are ready to say yes. Then you remember reading that people 65 and older got a new extra tax deduction this year. Does converting touch it? It can, and Medicare adds a second piece that shows up two years later. None of this says don't convert. It says check a few numbers first, so the family decides with the whole picture on the table.
What the new deduction is
For tax years 2025 through 2028, a person who turns 65 by December 31 of the tax year can take an extra $6,000 deduction. A married couple where both spouses qualify can take up to $12,000, but only on a joint return. It comes on top of the regular extra standard deduction for people 65 and older, and you can claim it whether you itemize or not.
Here is the part that matters for a conversion: the deduction shrinks as income rises. The IRS looks at modified adjusted gross income (MAGI), which starts from the adjusted gross income line on the Form 1040. Once MAGI passes $75,000 for one person, or $150,000 for a married couple filing together, the deduction drops by 6 cents for every dollar over that line. Following the arithmetic on the IRS form, it reaches zero at $175,000 for one person and $250,000 for a couple.
Why a December conversion can cost more than the bracket says
A Roth conversion counts as income in the year you do it. So a conversion pushes MAGI up, and if it lands inside that zone, every $1,000 you convert also takes $60 off the senior deduction. That is extra tax on top of the tax on the conversion itself. When both parents qualify, each loses the $60, so it is $120 per $1,000.
Two edges are worth knowing. Below $75,000 (or $150,000 for a couple), converting doesn't touch the deduction until it crosses that line. Above $175,000 (or $250,000), the deduction is already gone, so converting costs nothing more on this front.
Medicare adds a second layer. It looks back two years: for 2026 premiums, Social Security uses the 2024 tax return (or 2023 if 2024 isn't available). So the income from a December 2026 conversion is what Medicare reads when it sets premiums for 2028. In 2026, the Medicare surcharge (it's called IRMAA) starts above $109,000 for one person and $218,000 for a married couple filing together. The first step adds $81.20 a month to the Part B premium, per person. Those are 2026 figures and they get updated every year, so ask for the current table before you decide.
Rosa's numbers (a made-up example)
Say Rosa is single and her income this year, before any conversion, is about $70,000. Assume the conversion dollars would be taxed at 22%, and ask her preparer for her real rate.
- Convert $30,000. Her MAGI becomes $100,000, which is $25,000 over the line. The deduction shrinks by $1,500, which costs her about $330 in extra tax. She stays under the $109,000 Medicare line with $9,000 to spare.
- Convert $50,000. Her MAGI becomes $120,000, which is $45,000 over the line. The deduction shrinks by $2,700, about $594 in extra tax. She also crosses $109,000, so at 2026 levels she would pay about $974 more in Part B premiums for one year, two years from now. That is roughly $1,568 on top of the tax on the conversion.
Neither plan is wrong. The point is that the second one has a price tag the bracket alone never shows, and Rosa gets to decide whether the extra $20,000 is worth it to her.
Four things to check first
- Add up this year's full income. Pension, the taxable part of Social Security, interest, dividends, any December fund distribution, and the required minimum distribution if she already takes one. That total is the starting point the conversion stacks on. (A required minimum distribution has to come out first, and it can't be converted.)
- Find which lines are close. Is she under or over $75,000 (or $150,000 for a couple)? How far is she from the Medicare line at $109,000 (or $218,000)?
- Confirm she qualifies. She must turn 65 by December 31, have a valid Social Security number on the return, and file jointly if she's married.
- Ask the preparer to run the return both ways. One version with the conversion and one without, so the family sees the real difference and not a guess.
How to talk about it at the table
Start with what Mom wants, not with the tax. Ask what she hopes to leave and to whom, and what would worry her if a Medicare letter arrived in two years. Her money and her decision stay hers. Your job is to help her see the picture.
Something like: "Mom, before we decide anything, can we look at this year's income together?" Sit down with last year's return, this year's statements and one sheet of paper. Agree on a stop line, a number you won't go past, before anyone talks to the custodian. Decide who calls the preparer, and who watches the mail in two years so a surcharge letter doesn't land as a surprise.
Waiting is also a fine answer. A smaller conversion in December, with the rest in January when a new tax year opens fresh room, is often calmer than one big push. A Familia plan puts each generation's numbers on one screen while each person keeps their own privacy, and you can try the demo to see how a household looks side by side.
Where the numbers come from
- IRS: check your eligibility for the new enhanced deduction for seniors: $6,000 per eligible person, tax years 2025 to 2028, $12,000 for a couple, joint return required.
- IRS: 2025 Schedule 1-A, Part V: the $75,000 and $150,000 lines and the 6% reduction.
- CMS: 2026 Medicare Parts A and B premiums and deductibles: the 2026 surcharge tiers and premiums.
- Social Security: how IRMAA is calculated: premiums for 2026 use the 2024 tax return.
WiseNest Content Team
Written by the WiseNest Content Team, in partnership with founder Rich — dad of bilingual twins with special needs and the reason WiseNest exists.