The % are interesting way to look at it as its a $6708.08 hit for MFJ parents but it does allow them to take out $386,000 (cant tell what the actual number is etc based on inflation etc).I wanted to add thoughts on IRMAA. We are also filing MFJ... and I modeled predicted income plus varying Roth conversions through all the IRMAA brackets. In our case, we are shooting to maximize the 24% bracket and avoid (like plague) the 32%. Interestingly... the first couple IRMAA brackets really only push our marginal tax bracket from 24% to 27% or 27.7% (depending on which one. The sweet spot appeared to be the 2.6x bracket (keep in mind, it's a 1.6x hit, as you already have to pay base). It's a very gradual hit, so while you really want to avoid being over by a few dollars, being well into a band might pay off. One can make this decision each year, and the 3.2% bracket jumped up to 44% since we had very little "space" below the 32% federal bracket. The Finance Buff has the best predictions.
At the rate I am converting it would take them 3-4 more years to convert all of the tIRA but using the above numbers for 2024 could mean 2 years. Mom is going to have to take RMDs next year FYI.
The biggest worry is for hit for inherited IRAs Spouse/Kids etc which is part of all this.
What is the Finance Buff? Link?
Shahhere
Statistics: Posted by shahhere — Sat Feb 17, 2024 2:13 pm — Replies 9 — Views 508