Why does this matter now?
If you run a business, you make decisions with incomplete information all year. Fall is different. You finally see your year. Revenue patterns are clearer, payroll is mostly set, partner K-1s are in sight, and you know roughly what your 2025 taxable income will be. That’s exactly when a Roth conversion becomes powerful: you can choose how much income to create on purpose, at a tax rate you’re comfortable with, and you can do it on a market dip so you pay tax on a smaller number that later grows tax-free.
Think of a conversion as moving chips from a taxable table to a tax-free table. You pay to move them once; after that, the house (Congress, markets, inflation) can change the rules, and you’re less exposed. And 2025 is a big year for rule risk. Many provisions from the 2017 tax law are scheduled to sunset after December 31, 2025, which could mean higher brackets and a smaller §199A (QBI) landscape ahead. Converting in 2025 can be a way to bank today’s known rates while lowering future Required Minimum Distributions (RMDs) and the “widow’s penalty” risk if one spouse outlives the other.
Entrepreneurs also have a unique edge: income volatility. When income is lumpy, so are tax brackets. Fall gives you the best shot at using that volatility to your advantage—fill a bracket you choose, avoid hidden cliffs (ACA subsidies, Medicare IRMAA, NIIT), and push more of your eventual retirement spending into the tax-free column.
First, what are we actually doing?
A Roth conversion moves money from a pre-tax IRA/401(k) into a Roth. You pay income tax now, and then future growth and withdrawals are tax-free (if rules are met). There’s no undo button, and to count for 2025, the conversion must happen by December 31.
Why fall? By September–December, you can see your income, aim precisely at a tax bracket, and use market dips to convert at lower prices.
2025 guardrails at a glance
(print this)
Pick a target bracket, watch capital-gains bands, avoid surprise NIIT and Medicare surcharges, and don’t kill your QBI deduction by a few dollars.
Why fall is the “accuracy window”
1) You can finally measure “headroom.”
In spring, you’re guessing. In the fall, you have nine months of books. That allows you to estimate your taxable income and see the space left before you reach the top of 12%, 22%, or 24%. You’re not trying to be perfect—you’re trying to be directionally correct and leave a buffer (for year-end bonuses, surprise gains, or a late K-1).