+1If you don't need the money, you should convert it to Roth, not to your taxable account. If your son is in a high tax bracket, and the money is intended for him, you should be converting up to his marginal rate.Recently retired at age 69. Wife is also retired at 67. I know every situation is different but from what I've seen and read the "typical rule of thumb" is to withdraw from taxable accounts first (mostly equities), then tax deferred (mostly fixed income) then tax free We have no Roths so the tax free is not an issue here. Fortunately (or unfortunately, depending how you look at it) we will only be in the 10-12% tax bracket at most no matter what withdrawal strategy I use so we're not talking a million dollar portfolio. Taxable withdrawals by themselves should last 10-15 years which means the IRAs would continue to grow over that time until we're both in our early eighties. I am going to re-crunch the numbers but so far it doesn't look like Roth conversions would be that beneficial in my situation. My question is - would it be better to start partial withdrawals from our IRAs now in addition to taxable accounts in order to reduce or mostly eliminate the IRA balances when our son inherits them? He is in a fairly high tax bracket now and don't want to exacerbate the taxes he would owe. I would make the withdrawals in a way that wouldn't push us into a higher tax bracket now. It seems to me it makes more sense to leave him a larger amount in the brokerage account so he can use the step-up basis and pay no or little taxes. I have seen this strategy discussed but it doesn't seem to be the majority opinion. Any thoughts would be appreciated.
Statistics: Posted by RyeBourbon — Fri Nov 22, 2024 7:32 am — Replies 12 — Views 907