vince
Recycles dryer sheets
I did half of my conversion $ for the year over this past weekend. I will do the other half before year end.
Same here.....Only yesterday.
I did half of my conversion $ for the year over this past weekend. I will do the other half before year end.
You can convert, but only after taking out the RMD and not converting that.I wish we could still do this but we are in the RMD stage and unless I am wrong we can't do this anymore. Bummer!
Cheers!
I wish we could still do this but we are in the RMD stage and unless I am wrong we can't do this anymore. Bummer!
Cheers!
This is great to hear. Thank you everybody.I agree. What you cannot do is use the RMD money to convert. What you can do is use the RMD money to pay the taxes on the conversion though.
A move from 24% to 32% increases your taxes by 1/3 for the additional amount. The market right now is about 1/3 of its peak value for equities. So you are saving 1/3 by converting at the lower current price, versus converting at the peak, but paying an extra 1/3 for the taxes. Convert $1000 at the peak for $240 or $667 (about the same number of shares) now for $213. Save $27 converting now into a higher tax bracket instead of at the market peak. Might be worth it.
I find I can't hit the top of the 22% bracket without going above $250k AGI and hitting the extra 3.8% healthcare tax, which would wipe out this small gain.
You can still do Roth conversions, but you must withdraw all your RMDs before you convert and you can only convert other funds besides the RMDs.
Therefore your total withdrawals will be the RMDs first and then the additional conversions.
Not to pick nits, but are you sure that they have to be in a certain order? I would think that as long as the RMD is done in the calendar year that it needs to be done that it would be ok.
So for example, let's say I converted $x in January and did a withdrawal for the RMD in December.... what would be wrong with that?
Actually, I found something on Ed Slott's website that clarified that you must do your RMD before any Roth conversions... so order is important.
Thanks.
Actually, I found something on Ed Slott's website that clarified that you must do your RMD before any Roth conversions... so order is important.
Thanks.