Advantages for Roth conversions held for heirs include the taxes paid by the heirs, potential state inheritance taxes , and the advantage of extra time working on the conversions. Here are a couple of links on just the time potential advantage....Not really. 50-50 split between two heirs: one likely in a lower mid tax bracket and the other in a high tax bracket. We will not differentiate which accounts go where, etc. Just everything split evenly. I am not concerned that we are missing a huge opportunity, but I could well be wrong. Just done machinating endlessly.Do you have goals for heir(s)?I punted on optimizing Roth conversions after too many hours of discussion and analysis without tangible benefits.
We have current tIRA of ~3.2M.
I see very low risk in converting up to a total income below the first IRMAA break (which is below NIIT) which falls into the 22% bracket for MFJ.
Although further conversion could be beneficial, I think it is analogous to opensocialsecurity predictions: if you can exceed 90% of max, further optimization has very marginal utility. The future is unknowable.
If yes to the above ....did you model the effects of further conversions for that purpose?
Bogle wiki below ‘typical values’ on years held…
https://www.bogleheads.org/wiki/Traditi ... cal_values
BETR article by Vanguard
https://institutional.vanguard.com/insi ... sions.html
Statistics: Posted by smitcat — Sun Aug 04, 2024 2:17 pm — Replies 205 — Views 18618