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The primary reason why you do Roth Conversions is because you do not want your increased RMD from the IRA to make up to 85% of your SSB taxable.
I prefer to contribute to a Roth 401k or Roth IRA or a Backdoor Roth. I do not want to pay big taxes to convert my qualified account into a Roth.
Roth IRAs withdrawals aren't taxed. Start with Roths, so you don't have to convert.
I’m trying so hard to follow your channel but between you beating on the keyboard all the time, your scatter brain talking I always walk away thinking I’ve leaned nothing. Sorry man I tried to give you a fair shot but I’m done.
One day he says one must do Roth conversion. Few months later he says he won't do it. He spends half of his time making political statements. His sarcastic comments on a certain Govt is rather silly.
Do you want to pay tax on the seed or the tree? Do Roths.
Josh explain to me how this makes sense. A working couple in the 22% bracket married filing jointly are not only saving the 22% federal, they’re also saving state and city income tax. In your example the widows tax trap the effective tax rate would go from 6.3 to 12%. That is still over 10% less in taxes from the marginal rates if you choose Roth while working.
Beig single always screws you over when you pay Federal Taxes. Federal Government punishes those that are single. Married couples with dependants really get a break.
I tried hard to watch your video, but you have two much drama. I plan on converting to Roth from my 401K Rollover for the years I am not working, and not collecting social security. So my tax rate will be lower during this time. My window will be from 65 to 67. My Full Retirement is 66 1/2, but will push it out to 67. I don't see my going past that time. I am concerned about IRMAA, but I will monitor this closely. I do plan on doing my conversion in December every year so I can see where I am on my current AGI, and take the difference of my target AGI, and that will be what I convert.
Is there any difference between widow vs single rates? My husband died in February of 2009 . I think it's been applied single not Widow. But not sure.
I'm 60 and have a unique situation where I will earn the same in retirement that I'm earning right now. I will have over $1 mil in my traditional 401k at retirement plus several hundred k in a Roth. Should I convert the traditional money to a Roth?
Why don't you want Roth conversions with Obamacare?
Lots of talk but fuzzy planning
The other concern I have is that we are in the latter part of the 2017 tax cut. If we end up going up a few percentage points, then the effective rate should be higher. I'd like to give up saving at 22% and then save at 24% in the future. With the way our friends in DC like to spend I believe taxes will go up rather than down.
My mom and dad deferred as long as possible while doing amazingly well with their IRA investments. Now they are in their 80s and paying 40 % in taxes. So they tax – differed when they were in the 12% tax bracket only to withdraw in the 40% tax bracket ( fed plus state plus Medicare penalty) . Govt keeps changing the rules.
This is a really good video, I was appalled by the amount of taxes I will pay in retirement as a single person. I have run some scenarios and about fainted when I found out what my effective tax rate would be.
Thank you for providing a site that I can use to estimate my taxes.
Not one of your better videos.
You need to drive to a BOTTOM LINE sentiment.
And you frustratingly drop BOMBSHELL statements like "Roth IRAs are impacted by Obamacare" without backing it up in simply terms.
50 % of seniors over age 80 end up in a nursing home so they do get to deduct those costs that excess 7.5% of their adjusted gross income.
If we are trying to stay in 12% bracket for 2021 . I believe $81050 + $25100 total $106,150 would be Our limit. Would we also subtract FSA and medical premiums from total allowing us to add more to the Roth conversion?
Yer damned if you do and yer damned if you don’t.
You have touched on the ridiculous complexity and expense to seniors of tax and Medicare laws. These are my issues. The political class insists on defining what the "issues" are. They don't simply ask their constituents what is really going on that is important to them. Much of the complexity is to sneak in extra taxes on middle class seniors to "save" Medicare and Social Security, without simply raising the tax rate. They can then pretend to not "raise taxes."
Examples are taxation of social security, "IRMAA" premium penalties on Medicare, required minimum distributions, not allowing stepped up basis on all retirement plans on the death of the owner and the ridiculous "quarters" used in estimated taxes.
Thank you so much for bringing all of this up.
idk much about IRAs, and to be frank, I don't have one. I will have two pensions that come out to about 7K per month pre-tax not including SS. While I do contribute to TSP and my job matches that contribution, there is no way I'm going to make up for 30 years of not contributing while I was in the military (I started near the end). The calculators are all based on "savings" and make assumptions of needing over 100K per year of income in retirement (which would be a pay raise) and do not seem to take the pensions into account. I'm confused…it looks to me like I am in a good place, but every calculator I have used ends up with something like "you need to save another 400K. Well, that isn't happening in the next 5 years…not that I'll make 400K in the next 5 years…
Mistake not to do a Roth
Not that it matters to me anymore Josh, but I have not seen a proposal of ending IRAs at 140K. But lets face it this administration is borderline rogue right now. They will propose anything and throw money at the masses to get some movement in the polls to the positive side because how can you go any lower than a subterranean basement.