I've read all the early (post-59.5, pre-RMD) IRA liquidation / conversion threads I can find on this site. (Shout-out to sengsational for many good references and comments.)
I then:
- read Kitces and Welch (i-orp) on RMD minimization
- used extended i-orp to get specific IRA liquidation recommendations
- run regular, spousal and non-spouse bennie* RMD calculators on current IRA amounts
Yikes! RMDs, particularly bad for DH if I check out first, running as high as $80k / year.
i-orp recommends I liquidate $90k the first year - another "yikes!" tax-wise, plus goodbye ACA subsidy.
Also considered the Kitces "bucket" route to liquidate only up to the edge of [whatever] bracket. This lessens the taxes, but even these lower liquidations eliminate the ACA subsidy.
So if I'm going to lose $6k in subsidies either way, maybe I should bite the tax bullet now to get to the "zero IRA funds by 70" Promised Land?
Have any of you taken the full i-orp-recommended liquidation route in your fifties and/or sixties?
*There is a chance (which I do not count on when running calculators) my step-mother may leave me a six-figure IRA inheritance. So I could have non-spouse beneficiary RMDs as well. Not complaining, but when I consider all possible RMD scenarios, it does appear wise to take at least some tax hit now to start minimizing them.
I then:
- read Kitces and Welch (i-orp) on RMD minimization
- used extended i-orp to get specific IRA liquidation recommendations
- run regular, spousal and non-spouse bennie* RMD calculators on current IRA amounts
Yikes! RMDs, particularly bad for DH if I check out first, running as high as $80k / year.
i-orp recommends I liquidate $90k the first year - another "yikes!" tax-wise, plus goodbye ACA subsidy.
Also considered the Kitces "bucket" route to liquidate only up to the edge of [whatever] bracket. This lessens the taxes, but even these lower liquidations eliminate the ACA subsidy.
So if I'm going to lose $6k in subsidies either way, maybe I should bite the tax bullet now to get to the "zero IRA funds by 70" Promised Land?
Have any of you taken the full i-orp-recommended liquidation route in your fifties and/or sixties?
*There is a chance (which I do not count on when running calculators) my step-mother may leave me a six-figure IRA inheritance. So I could have non-spouse beneficiary RMDs as well. Not complaining, but when I consider all possible RMD scenarios, it does appear wise to take at least some tax hit now to start minimizing them.