I'll add an example to help clarify my response above but excuse my napkin tax math as I don't have 2025 turbotax with the new brackets and deductions - so pls verify but hopefully this helps illustrate:
If you're single and over 65 your standard deduction for 2025 will be 15750+6000 =21,750
Taxable income bracket for 0% LTCG rate is $48350. Ordinary income "fills up this bucket" first, whatever space is left for your LTCG is taxed at 0% the rest at 15%. So the bigger the Roth Conversion the more you push your LTCG into the 15% rate
If you do a $30k Roth conversion plus $4k RMD your taxable income will be 30000 + 4000 + 36000 - 21750 =48,250. Your LTCG will be fully 0%. You will pay tax on $12250 = $1232 (almost all in the 10% bracket).
Good deal so far. But if you do a 100k Roth conversion your taxable income will be 100000 + 4000 + 36000 - 21750 =118,250. You will now pay 15% rate on the full $36k LTCG for $5400; plus ordinary tax on 82250 is $13009 (15.82%). Your total tax will be $18409. The additional 70k in Roth Conversion is triggering additional 18409-1232 =17,177 in tax including the LTCG effect, so this extra conversion is effectively being taxed at 25% (not great).
Note this does not take into account any taxable interest or dividends you must surely have on the $20k in Brokerage and the 14k you put into the CD etc.
Other conversion amounts in-between 30k and 100k will partially trigger the 15% LTCG rates.
If this LTCG is a one-off you are probably better off doing a smaller Roth this year that preserves the 0% LTCG rate but your wealth advisors should advise on that.
Not a CPA, hope that helps.
