A Timely Reason To Take a Fresh Look at Roth IRA Option

BY STEVE DINNEN

online pharmacy synthroid buy with best prices today in the USA
online pharmacy purchase arava without prescription with best prices today in the USA
online pharmacy doxycycline for sale no prescription pharmacy
Much year-end tax planning is going on, so here’s another item to consider: Rolling a traditional IRA into a Roth IRA to trim or even eliminate future taxes.

The idea here is to let the money grow tax free in a Roth instead of taxable with a traditional IRA. Also, there are no required minimum distributions like there are on traditional IRAs.

Kevin Wingert, at American Retirement Systems in Urbandale, works with nationally known financial planner Ed Slott and provides this example. A couple has taxable income of $100,000. The first $19,500 in taxed at 10 percent, the next $58,350 is taxed at 12 percent and the remaining $22,600 is at 22 percent. They have another $65,000 of taxable income before hitting the 24 percent tax bracket. So, use some of the remaining 22 percent tax bracket to get funds into the tax-free Roth, as you have to pay taxes on funds rolled out of a traditional IRA.

If a child inherits a big lump sum from a traditional IRA all in one year, they could very well end up in a much higher tax bracket since it’s all taxed as ordinary income in the year they take it. Funds inherited from a Roth IRA are tax free.

You May Also Like

Lauridsens are Lead Donors for New Hope Campus

From left: Leon Negen, president and CEO of Hope Ministries, and Nix and Virginia ...

Momentum builds for capital campaign at Blank Park Zoo

Big cats will soon have a bigger place to call home at Blank Park ...

Altering Your Investment Portfolio During Times of Inflation

By Steve Dinnen Inflation is upon us. It’s in our grocery cart. It’s on ...