The US taxes Roth conversion income regardless of where you live, it's treated as ordinary income and the FEIE does not reduce it. What changes by location is whether a second layer of local tax also applies. In most countries, a resident converting traditional IRA funds to Roth owes both US federal tax and local income tax on the same dollars.

In some jurisdictions, local tax does not apply to the conversion, meaning only the US side is due.

For Americans living in those jurisdictions, the math on a Roth conversion looks meaningfully different than it does for someone back in the US (or someone in a country that layers local tax on top).

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