Although that might sound aggressive and unnecessary, there are many scenarios where a Roth IRA conversion can make sense. For example, let’s say you’re not earning a lot of money in a specific year and you want to convert to a Roth IRA while paying an extremely low tax rate. You co...
For simplicity, assume your Traditional IRA consists of an equal amount of Total Stock Market and Total Bond Market index funds. To start building a normal Roth IRA Conversion ladder, you’d just convert $10,000 of your balanced portfolio to your Roth IRA ($5,000 of Total Stock Market and...
The caveat, though, is that if this yearisa low-income year, the Roth conversion must be executed by the end of the year. Although taxpayers have as late as their tax filing deadline, plus extensions, to recharacterize a Roth conversion, the original conversion itself must be completed...
I don’t fully understand the tax implications that are involved in that. Correct me if I’m wrong, but $5000 would go into the Roth and the rest into a traditional account. I think I know the answer, but do you think it is fine to have the investments in my 403(b), Roth IRA,...