I've started cashing some of our paper bonds initially totaling well over $500k. I include them in our overall tax strategy this year and next to pay zero federal tax so the bonds plus interest, Roth conversions and the like stay under our standard deduction. For more "income", we're selling dividend paying funds in taxable and mostly re-buying into BRK/b so as to eliminate as much dividends as possible. We're retired. All of our bonds are "or" 2 names and some have one of our 2 kids along with one of us parents so those are being held for now but can easily go to them when the time comes. Only about $150k to $175k with our kids' names.
I've learned that understanding all the limits is essential in understanding tax strategy. I'm 68 so have this and next tax year before social security hits so it's the last of the zero federal tax years. After that, we'll watch the $6000 deductions, IRMAA and will be well under NIIT, keep inside the 15% LTCG bracket. In the case of the OP, being over 70, I expect social security is already being taken so unless there are outrageously high deductions, the zero strategy won't work. For us at that point, we'll look to maximize mainly Roth conversions as the tIRA accounts are already over $3M and gaining every year. I do project future income, mainly focused on social security and RMDs to understand what we'll be facing at that point. I've already accepted that once one of us goes, the taxes, lack of $6000 deductions and IRMAA are going to be very high. Oh well.
I've learned that understanding all the limits is essential in understanding tax strategy. I'm 68 so have this and next tax year before social security hits so it's the last of the zero federal tax years. After that, we'll watch the $6000 deductions, IRMAA and will be well under NIIT, keep inside the 15% LTCG bracket. In the case of the OP, being over 70, I expect social security is already being taken so unless there are outrageously high deductions, the zero strategy won't work. For us at that point, we'll look to maximize mainly Roth conversions as the tIRA accounts are already over $3M and gaining every year. I do project future income, mainly focused on social security and RMDs to understand what we'll be facing at that point. I've already accepted that once one of us goes, the taxes, lack of $6000 deductions and IRMAA are going to be very high. Oh well.
Statistics: Posted by Jack FFR1846 — Sat Dec 27, 2025 6:55 am — Replies 5 — Views 181