Income Offset on Roth Conversion With a DAF
Looking to convert one of my Traditional IRAs to Roth in this down market. Also mapping out my future charitable giving using a Donor Advised Fund. Anyone use this combination to mitigate tax on conversion? Thanks!
Permalink Submitted by Alan - IRA critic on Tue, 2022-07-12 17:52
Any itemized deductions, if they result in taxable income being lower than what the standard deduction would be generated, would reduce the annual taxable income including the increased income from a conversion. Once you are 70.5 you may also consider a QCD to donate using pre tax IRA dollars. At 72, a QCD can offset taxable RMD income, but any conversion then will have to come after completing the RMD, so timing becomes critical.
Permalink Submitted by Don Tyler on Wed, 2022-07-13 20:12
Thanks! Thinking I could do this but don’t hear much about this strateg!