Does it matter whose IRA we convert to Roth?

[NW-Bound]

But it could be that one's RMD puts one "in the zone" and it could be that it stays that way for years...

Hence, it is worth the planning ahead. By the time RMD hits, you may not have room to maneuver. People keep saving their IRA/401k, saying they don't need it. Fine. The government will spend it for them.

A married couple has the 15% bracket in 2017 going up to $75,900 plus the exemption of $4,500 x 2, plus the standard deduction of $12,700. That's $97,600 which should give most people some room to do Roth conversion. Once SS starts, it is going to be tough to stay out of the 25% bracket and even the 28% bracket.

The problem is the pesky ACA cliff thinggy, else it is easy to see one should do.

 

[Cat-tirement]

I am also very interested in the OP's question, but in our case, my tIRA and 401k accounts are about twice the size of DW's and I am a couple of years older than she is.

I just did my first small Roth conversion last year, and I expect to do more while living off our joint taxable account, and before my small pension starts in 2-3 years. My thought was that it would be better to convert mine first since my RMDs will be larger and start sooner than hers. I plan on doing some analysis of this question after finishing with taxes, but maybe someone else has been in a similar situation and can offer some guidance.

 

[misanman]

my tIRA and 401k accounts are about twice the size of DW's

My tIRA is quite a bit larger than DW's but my goal has been to fully convert her's so that we will have only one tIRA to deal with.

 

[pb4uski]

Hence, it is worth the planning ahead. By the time RMD hits, you may not have room to maneuver. People keep saving their IRA/401k, saying they don't need it. Fine. The government will spend it for them.

A married couple has the 15% bracket in 2017 going up to $75,900 plus the exemption of $4,500 x 2, plus the standard deduction of $12,700. That's $97,600 which should give most people some room to do Roth conversion. Once SS starts, it is going to be tough to stay out of the 25% bracket and even the 28% bracket.

The problem is the pesky ACA cliff thinggy, else it is easy to see one should do.

+1 In our case (which be fairly unique), the value of lower taxes on Roth conversions while in this sweet spot of low income tax rates far exceeds the value of ACA subsidies. Over the last 4 years I figured that I have saved about $10k a year in taxes (actual federal taxes paid vs 25% that I expected to be in once SS and pensions are online) and the value of subsidies to us would be a lot less than $10k. At best, ACA subsidies would be worth ~$5k a year for us.

 

[Animorph]

I am also very interested in the OP's question, but in our case, my tIRA and 401k accounts are about twice the size of DW's and I am a couple of years older than she is.

I just did my first small Roth conversion last year, and I expect to do more while living off our joint taxable account, and before my small pension starts in 2-3 years. My thought was that it would be better to convert mine first since my RMDs will be larger and start sooner than hers. I plan on doing some analysis of this question after finishing with taxes, but maybe someone else has been in a similar situation and can offer some guidance.

+1

I'm 5 years older than DW. There is a significant difference in RMD amounts/timing between us. So my Roth conversions come first. We're in the middle of that now. When I'm done then we'll do DW's. I think that's the only reason we had to favor one account over another.

With only one or two years of age difference the financial benefit of one spouses Roth conversion over the other's would be smaller, but should be considered if there aren't any other concerns.