I know at least parts of this has been discussed and the problem is likely very dependent one each person's situation. I recall many posts that tended to focus on local marginal rates often focused on ACA subsidies. I expect this problem to need global optimization.
What I'm trying to understand is what is the best choices going forward to optimize the overall system. But that I should really assume that I keep as many dollars legally in the end with a time adjusted value of the $.
In my case I have more $ in after tax accounts than tax deferred and lots more than tax exempt. I think its about 55/43/2 taxable/deferred/exempt. To throw another twist.. inherited (stretch) IRAs may be in our future.
Presently my taxable generates mostly dividends and some LTCG with a small amount of ordinary income. I presently fund HSA to the max for investing for later heath care and pay the medical bills out of pocket. My IRAs are primarily invested in fixed income portion of our allocation.
Last year I converted up to the top of the 15% bracket (on cobra so subsidy did not come into play).
I'm curious on what analysis has been done to determine the trade off of all these interacting parts or what your thought process on this is. I've seen some do conversions up to the 15% bracket, some into or up to the limit of the 25% bracket, and some just focused on the subsidy.
I'm well aware of the marginal rate issues with the PTC, for CG & QD when exceeding the 15% bracket.
Feel free to tell me my location of my allocation doesn't make sense, but suggest a replacement with reasons so I can understand why.
Any insights would be appreciated.
What I'm trying to understand is what is the best choices going forward to optimize the overall system. But that I should really assume that I keep as many dollars legally in the end with a time adjusted value of the $.
In my case I have more $ in after tax accounts than tax deferred and lots more than tax exempt. I think its about 55/43/2 taxable/deferred/exempt. To throw another twist.. inherited (stretch) IRAs may be in our future.
Presently my taxable generates mostly dividends and some LTCG with a small amount of ordinary income. I presently fund HSA to the max for investing for later heath care and pay the medical bills out of pocket. My IRAs are primarily invested in fixed income portion of our allocation.
Last year I converted up to the top of the 15% bracket (on cobra so subsidy did not come into play).
I'm curious on what analysis has been done to determine the trade off of all these interacting parts or what your thought process on this is. I've seen some do conversions up to the 15% bracket, some into or up to the limit of the 25% bracket, and some just focused on the subsidy.
I'm well aware of the marginal rate issues with the PTC, for CG & QD when exceeding the 15% bracket.
Feel free to tell me my location of my allocation doesn't make sense, but suggest a replacement with reasons so I can understand why.
Any insights would be appreciated.