Key Takeaways
When it comes to taxes, inflation is great … The rates don’t change, but the brackets expand each year. When they expand, your tax bill becomes lower.
One commonly dispensed piece of advice is that if you want to convert some of your IRA from traditional to Roth, you should convert enough just to the top of your tax bracket. You never want to leave a bracket unused because you don’t get it back. The key to tax planning is to always get your money out at the lowest rates, and that’s using to the fullest extent the brackets.
Accelerating IRA withdrawals can be a good strategy to try to reduce your RMD subject balance. You would probably do that and put it in a Roth unless you needed the money for spending. You want to control your tax rates.
The key is to take advantage every year you can of these giant, expanding brackets that have currently very low rates when it comes to your IRA money. So as long as you know it’s going to be taxed, get it on sale.
コメント