Early and Regular Roth Conversions to avoid RMD’s
I noted from an earlier post that a Roth conversion cannot be used in lieu of the RMD requirement.
So as a strategy to avoid future RMD’s, would you recommend doing Roth conversions over time before one turns 70 and 1/2? Your thoughts?
Permalink Submitted by Alan - IRA critic on Mon, 2017-11-06 23:29
Yes, that is a common practice because the chance of the marginal tax rate being lower then than after RMDs begin is good. Even better if SS benefits have not been started and the taxpayer is retired and not getting wage income. In that case the low tax years between retirement and when RMDs begin is an opportunity to do incremental Roth conversions in each such year, perhaps up to the top of your current tax bracket.