jesusbowls
Level 3
a month ago
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I face many situations where clients can convert Traditional to Roth while staying within the 12% marginal federal tax bracket. And in my primary state (NY), the first $20K of taxable IRA distributions per person are exempt from tax (assuming no private pensions are being collected). These situations typically arise when clients are retired but not yet collecting social security. To me, a 12% marginal tax cost on a conversion is an attractive proposition. It reduces future RMDs, and is much preferable for heirs who typically end up inheriting these accounts during their prime income-earning years.