Same here. But that's just playing "if only I'd have known..." about specific tactics. No regrets about the strategy.I assume you are talking about an IRA to Roth conversion? If so, I just regretted pulling the trigger on a large conversion in early 2020. The stock I converted was around $70/shr. If I had waited until the big correction in March 2020, could have converted a much larger number of shares at around $45/shr for the same amount of $$. Oh well.
I converted too much in 2020 and didn't qualify for the stimulus checks as a result. UGH.
I will always keep $300K in my IRA, as LTC insurance, meaning if I need to spend it on medical/nursing home costs, there will be a giant tax deduction so most of it will end up tax free, so no need to convert.
So medical costs paid out of a regular IRA aren't taxed? What is the point of an HSA?
I have been toying with ROTH conversions since we retired 5 years ago. There was always something going on each year which made ROTH conversion very expensive and we had never done it.
We are now at 22% and 24% tax brackets, depending on whether capital gains for that year push us into the 24% bracket. It is just too much of a financial hit to pay taxes on ROTH conversions. We have about the same amount of net worth in taxable and tax deferred accounts. If/when one of us passes away first, we are looking at the dreaded 32% tax bracket. Then when both of us pass away, my son in California will be paying California income tax on inherited IRA withdrawals as well. It is just hard to win in this tax avoidance/reduction game.
RMDs and Soc Sec are what pushed me to start Roth conversions, we won't start either for 3-5 years (was 6-8 years when I started conversions). If you've already started RMDs and Soc Sec, Roth conversions probably won't matter anymore...I have been toying with ROTH conversions since we retired 5 years ago. There was always something going on each year which made ROTH conversion very expensive and we had never done it.
We are now at 22% and 24% tax brackets, depending on whether capital gains for that year push us into the 24% bracket. It is just too much of a financial hit to pay taxes on ROTH conversions. We have about the same amount of net worth in taxable and tax deferred accounts. If/when one of us passes away first, we are looking at the dreaded 32% tax bracket. Then when both of us pass away, my son in California will be paying California income tax on inherited IRA withdrawals as well. It is just hard to win in this tax avoidance/reduction game.
RMDs and Soc Sec are what pushed me to start Roth conversions,
I have been toying with ROTH conversions since we retired 5 years ago. There was always something going on each year which made ROTH conversion very expensive and we had never done it.
We are now at 22% and 24% tax brackets, depending on whether capital gains for that year push us into the 24% bracket. It is just too much of a financial hit to pay taxes on ROTH conversions. We have about the same amount of net worth in taxable and tax deferred accounts. If/when one of us passes away first, we are looking at the dreaded 32% tax bracket. Then when both of us pass away, my son in California will be paying California income tax on inherited IRA withdrawals as well. It is just hard to win in this tax avoidance/reduction game.
Last year, I decided to initiate following i-ORP’s recommendation that I begin 5 years of large ROTH IRA conversions. So I did a $250K conversion in January 2020, and spent the whole rest of the year kinda regretting it, but unable to recharacterize the conversion due to new laws preventing that. I knew it would put me in a higher tax bracket, but it also caused me to return the ACA premium subsidy at tax time, and we no longer qualified for the stimulus money. Also, DH is facing IRMAA Medicare premium increases since he begins Medicare this month. So overall, I wish I had waited till December to make the decision instead of January. I would have made the amount much smaller, I think.
I thought that extra ACA subsidies did not have to be paid back for 2020, that year only? That's what it says in https://www.healthinsurance.org/faq...m-subsidy-is-too-big-will-i-have-to-repay-it/ and I've seen a lot of discussion here.Last year, I decided to initiate following i-ORP’s recommendation that I begin 5 years of large ROTH IRA conversions. So I did a $250K conversion in January 2020, and spent the whole rest of the year kinda regretting it, but unable to recharacterize the conversion due to new laws preventing that. I knew it would put me in a higher tax bracket, but it also caused me to return the ACA premium subsidy at tax time, and we no longer qualified for the stimulus money. Also, DH is facing IRMAA Medicare premium increases since he begins Medicare this month. So overall, I wish I had waited till December to make the decision instead of January. I would have made the amount much smaller, I think.
The one thing I wish I had done was take more advantage of the special rule, I think it was in 2010, where you could convert and split the taxes over 2011 and 2012. It seems like the "convert now, pay the taxes a little later" strategy was worth a better look at the time than I gave it. Too late now, so I never figured out how big that mistake was after the fact.
Lots of data on why or why not to do Roth Rollovers but what I would really love to hear, anyone regret doing an IRA to Roth rollover. And if you did why?
Many of us find that spending and taxable income aren't related that closely. For example, if you have an asset with a very small unrealized capital gain, you can sell that asset and get those funds with very little tax impact.I've been asking the same question myself. After doing some calculations on future RMD's I was astonished at those amounts especially when you reach 90yo. A recent (SS?) table showed that there was a 50% chance that one of us would live to that age. The amount for 90 was about half our current home price! I know it's inflated dollars but still...
But the problem I'm wrestling with is my WR is somewhat high from now (age 59) until we start social security (planning 2029ish) and our mortgage is paid off in 2028 then drops drastically. So do we take $15k a year to pay the taxes for conversion on top of the WR or spend that money now and enjoy it?
Unless, of course, DS looks at his tax situation and the inheritance, and decides to move to a lower COL state, and retire himself.