why would you ever consider depositing an IRA Withdrawal into a brokerage account ?
Looking for insight – when someone beyond 59.5 years old wants to withdrawal funds from their deferred retirement account (401K, IRA, …….) as I understand it can either deposit the funds into their brokerage account or convert the funds into a Roth account. Assuming they have had a Roth account for the 5-year waiting period, why would they ever consider depositing into their brokerage account? Am I missing something?
Permalink Submitted by Alan - IRA critic on Wed, 2020-12-23 15:29
Perhaps if they will need the funds very soon to pay bills or expected bills including a margin call, or plan to gift the funds to someone. Otherwise, they are going to owe taxes anyway, so converting will result in all the gains being tax free as opposed to having to report cap gains and dividends and owe current taxes.