Originally Posted by REWahoo!
Agreed. The point I was trying to make was you have to consider other taxable income during the year in which you do the Roth conversion.
Got it. It does have the feeling of taking bitter mediciine. I hope that we all remember that and write congress people if need be years from now if they ever decide the want to 'have their cake and eat it too' and start taxing us a second time.
My accountant and I work out, every November, what my AGI is likely to be, and we then set about 'harvesting' the remainder of any 10% or 15% federal tax brackets by converting that amount of IRA/401k to Roth before 12/31 of that year.
For me its all about the compound interest factor -- the amount of tax you'll eventually pay during the RMD years because the IRA has grown so big during the decades it compounded, and now its all taxable at ordinary income rates.