We are going to convert some traditional IRA to Roth this year for the first time and I have a couple questions.
1. To get to the top of a tax bracket, am I correct that this is calculated on taxable income and not AGI?
2. DH will get SS this year for the first time. Does any of the nontaxable portion have to be added back to income when calculating to get to the top of the ta bracket?
3. How are LT capital gains anticipated for 2018, currently taxed at 0% treated in conversion assuming we still stay in the 12% bracket? In other words, do I have to make any special calculation for those.
We will want to maximize conversion to the top of the 12% bracket. Income for 2018 is SS, taxable pension, interest income, small business income for which we will get 20% exclusion on the net, and trad IRA withdrawal.
Bigger question-- anyone considering going to the top of the 22% bracket if you know you will be in higher brackets come RMD time since the current tax brackets expire in 7 years?
1. To get to the top of a tax bracket, am I correct that this is calculated on taxable income and not AGI?
2. DH will get SS this year for the first time. Does any of the nontaxable portion have to be added back to income when calculating to get to the top of the ta bracket?
3. How are LT capital gains anticipated for 2018, currently taxed at 0% treated in conversion assuming we still stay in the 12% bracket? In other words, do I have to make any special calculation for those.
We will want to maximize conversion to the top of the 12% bracket. Income for 2018 is SS, taxable pension, interest income, small business income for which we will get 20% exclusion on the net, and trad IRA withdrawal.
Bigger question-- anyone considering going to the top of the 22% bracket if you know you will be in higher brackets come RMD time since the current tax brackets expire in 7 years?