I suggest he do things in this order:
1. Since HE has an RMD for this year and SHE doesn't, he should first take his RMD.
2. He should merge her tIRAs into his IRA. Now all the money is his (and Uncle Sam's) like it had been there all along and the year-end balance will be used to calculate next year's RMD.
3. Since he will need to file as Single next year and Singles have half as much room in their tax brackets compared to MFJ, he should convert to the top of his current MFJ tax bracket or the next higher bracket. (Estimate what next year's RMD will do to his Single's tax return next year and then he will understand why.)
If he has a lot more than he thinks he will ever need, he can also start QCDs.
1. Since HE has an RMD for this year and SHE doesn't, he should first take his RMD.
2. He should merge her tIRAs into his IRA. Now all the money is his (and Uncle Sam's) like it had been there all along and the year-end balance will be used to calculate next year's RMD.
3. Since he will need to file as Single next year and Singles have half as much room in their tax brackets compared to MFJ, he should convert to the top of his current MFJ tax bracket or the next higher bracket. (Estimate what next year's RMD will do to his Single's tax return next year and then he will understand why.)
If he has a lot more than he thinks he will ever need, he can also start QCDs.
Statistics: Posted by celia — Sun Feb 18, 2024 2:13 pm — Replies 7 — Views 582