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Looks like Secure 2.0 will pass [emoji16]
05-06-2021, 06:09 AM
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#1
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Thinks s/he gets paid by the post
Join Date: Jun 2004
Location: Diablo Valley (SF Bay Area)
Posts: 2,704
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Looks like Secure 2.0 will pass [emoji16]
So this means I can just let my IRA grow until 75! Will step up income in retirement by taking SSA this year & IRA at 75. Anyone else excited?
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05-06-2021, 06:45 AM
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#2
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Full time employment: Posting here.
Join Date: Nov 2020
Posts: 743
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As I approach retirement, it amazes me how much of it is managing taxable income (RMDs, ACA, Roth conversions, limiting taxes on Social Security) and I haven't even started looking at medicare stuff
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05-06-2021, 06:48 AM
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#3
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Full time employment: Posting here.
Join Date: Jul 2011
Location: South Florida
Posts: 551
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Gosh, if this keeps on occurring - I may be able to wait until I am 100 until I begin my RMDs
Rich
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05-06-2021, 06:57 AM
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#4
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Thinks s/he gets paid by the post
Join Date: Oct 2017
Location: Tellico Village
Posts: 2,596
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The RMD phase in seems very complicated, just the way congress likes it.
__________________
Retired May 13th(Friday) 2016 at age 61.
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05-06-2021, 07:09 AM
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#6
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Jun 2002
Location: Texas: No Country for Old Men
Posts: 50,000
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So I will turn 75 later this year, missing out on realizing any benefit from this legislation. I also missed out on the RMD change to 72. Reminds me of my working days when after 15 years with the company I finally qualified for a third week of vacation - the same year they reduced the qualification to 5 years.
Everyone is invited to my pity party.
__________________
Numbers is hard
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05-06-2021, 07:34 AM
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#7
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Thinks s/he gets paid by the post
Join Date: Jun 2004
Location: Diablo Valley (SF Bay Area)
Posts: 2,704
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Correction: I can only let my IRA grow until 73. Ah well. I knew the IRS would want their cut
"SEC. 105. INCREASE IN AGE FOR REQUIRED BEGINNING DATE FOR MANDATORY DISTRIBUTIONS.
‘‘(I) In the case of an individual who attains age 72 after December 31, 2021, and age 73 before January 1, 2029, the applicable age is 73."
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05-06-2021, 07:37 AM
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#8
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Jan 2006
Location: Rio Grande Valley
Posts: 37,931
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Quote:
Secure 2.0 increases the RMD age further to 73 starting on Jan. 1, 2022; to 74 starting on Jan. 1, 2029; and 75 starting on Jan. 1, 2032.
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So it’s going to be 73 for those born 1950 or later starting next year, 74 for those born in 1956* or later starting in 2029, and 75 for those born in 1958 or later.
*Someone born in 1955 will turn 73 in 2028, so they would still be subject to RMD starting that year instead of 74.
__________________
Retired since summer 1999.
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05-06-2021, 10:08 AM
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#9
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Thinks s/he gets paid by the post
Join Date: Feb 2014
Location: Syracuse
Posts: 3,501
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Now I'll be able to bring more with me when I die!
__________________
“No, not rich. I am a poor man with money, which is not the same thing"
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05-06-2021, 10:26 AM
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#10
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Thinks s/he gets paid by the post
Join Date: Oct 2019
Posts: 3,652
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Quote:
Originally Posted by audreyh1
So it’s going to be 73 for those born 1950 or later starting next year, 74 for those born in 1956* or later starting in 2029, and 75 for those born in 1958 or later.
*Someone born in 1955 will turn 73 in 2028, so they would still be subject to RMD starting that year instead of 74.
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That's me born in 1955.
Oh well, at least I get one more year for Roth Conversions without RMDs.
My young bride will get to wait until 75!
Now, how do I split the Roth conversions to minimize the amount left in IRAs? Maybe it doesn't matter which one of us has what amount left in their IRA account.
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05-06-2021, 10:45 AM
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#11
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Recycles dryer sheets
Join Date: Mar 2021
Location: Seattle
Posts: 81
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Thanks to this forum and the education it's provided me, I plan to convert all my pre-tax 401K into a Roth IRA in yearly manageable chunks and be done before I'm forced to take any RMDs... I'm able to start early thanks to the "rule of 55" which applies to my 401K.
__________________
FIRE'd in Nov 2021 at 55
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05-06-2021, 10:57 AM
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#12
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Jan 2006
Location: Rio Grande Valley
Posts: 37,931
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Quote:
Originally Posted by Time2
That's me born in 1955.
Oh well, at least I get one more year for Roth Conversions without RMDs.
My young bride will get to wait until 75!
Now, how do I split the Roth conversions to minimize the amount left in IRAs? Maybe it doesn't matter which one of us has what amount left in their IRA account.
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Same with us. DH will just miss 74 as he was born in 1955, I will just make the 75 year.
__________________
Retired since summer 1999.
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05-06-2021, 10:58 AM
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#13
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Jan 2006
Location: Rio Grande Valley
Posts: 37,931
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Quote:
Originally Posted by PageTwo
Thanks to this forum and the education it's provided me, I plan to convert all my pre-tax 401K into a Roth IRA in yearly manageable chunks and be done before I'm forced to take any RMDs... I'm able to start early thanks to the "rule of 55" which applies to my 401K.
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I think you can do Roth conversions before 55. Has naught to do with Rule of 55.
__________________
Retired since summer 1999.
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05-06-2021, 11:04 AM
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#14
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Thinks s/he gets paid by the post
Join Date: Jul 2011
Location: The Bay Area
Posts: 2,736
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Quote:
Originally Posted by PageTwo
Thanks to this forum and the education it's provided me, I plan to convert all my pre-tax 401K into a Roth IRA in yearly manageable chunks and be done before I'm forced to take any RMDs...
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Why "chunks?" Can't you just do a Mega-Back Door conversion? That's what I did.
__________________
You may be whatever you resolve to be.
100% x 10% > 10% x 100%
Small pensions & SS cover essentials
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05-06-2021, 11:10 AM
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#15
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gone traveling
Join Date: Aug 2020
Posts: 682
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Is an updated RMD divisor calculator published for the proposed revised RMD age change?
I ran a quick calculation in my model with age 75 RMD using the same divisors as age 72, and it didn’t change my net worth balance much at end of planned life expectancy. This is to be expected, a regulation change that gets headlines but the real effect is small.
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05-06-2021, 11:24 AM
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#16
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Thinks s/he gets paid by the post
Join Date: Oct 2019
Posts: 3,652
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Quote:
Originally Posted by PageTwo
Thanks to this forum and the education it's provided me, I plan to convert all my pre-tax 401K into a Roth IRA in yearly manageable chunks and be done before I'm forced to take any RMDs... I'm able to start early thanks to the "rule of 55" which applies to my 401K.
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I started converting our tIRAs, but I want to stay in the 12% tax bracket while I do that. This year I was able to convert $75k. The first world problem I have is, it's been growing faster than I can take it out!
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05-06-2021, 11:47 AM
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#17
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Full time employment: Posting here.
Join Date: Nov 2020
Posts: 743
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Quote:
Originally Posted by Huston55
Why "chunks?" Can't you just do a Mega-Back Door conversion? That's what I did.
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You would do "chunks" to stay in a lower tax bracket (I think)
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05-06-2021, 12:12 PM
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#18
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Thinks s/he gets paid by the post
Join Date: Jul 2011
Location: The Bay Area
Posts: 2,736
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Quote:
Originally Posted by PageTwo
Thanks to this forum and the education it's provided me, I plan to convert all my pre-tax 401K into a Roth IRA in yearly manageable chunks and be done before I'm forced to take any RMDs... I'm able to start early thanks to the "rule of 55" which applies to my 401K.
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Quote:
Originally Posted by Huston55
Why "chunks?" Can't you just do a Mega-Back Door conversion? That's what I did.
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Quote:
Originally Posted by qwerty3656
You would do "chunks" to stay in a lower tax bracket (I think)
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That makes sense if: (1) your 401k Plan Description will allow it and, (2) any tax savings are worth the effort. For me, my Plan Description allowed the Mega-Back Door conversion but, only once. Also remember that tax is due on only the "earnings", which must follow their original associated Post-Tax 401k contributions. So, perhaps, the tax on the earnings might not be large enough for you want to do it twice. YMMV.
__________________
You may be whatever you resolve to be.
100% x 10% > 10% x 100%
Small pensions & SS cover essentials
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05-06-2021, 12:50 PM
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#19
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Mar 2005
Location: Chicago
Posts: 13,148
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Quote:
Originally Posted by REWahoo
So I will turn 75 later this year, missing out on realizing any benefit from this legislation. I also missed out on the RMD change to 72. Reminds me of my working days when after 15 years with the company I finally qualified for a third week of vacation - the same year they reduced the qualification to 5 years.
Everyone is invited to my pity party.
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Ditto here on missing the benefit of the RMD changes!
__________________
"I wasn't born blue blood. I was born blue-collar." John Wort Hannam
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05-06-2021, 12:56 PM
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#20
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Administrator
Join Date: Jan 2008
Location: Chicagoland
Posts: 40,518
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Quote:
Originally Posted by REWahoo
So I will turn 75 later this year, missing out on realizing any benefit from this legislation. I also missed out on the RMD change to 72. Reminds me of my working days when after 15 years with the company I finally qualified for a third week of vacation - the same year they reduced the qualification to 5 years.
Everyone is invited to my pity party.
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Let’s all commiserate together over a pint.
While I missed all these breaks, and also the health care ones, I’m still retired, and quite happy to be here.
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