Hi,
I was unemployed this year, and thought this would be a great year to do IRA conversions for my wife and me, since we would be at a lower tax rate.
I also have medical bills that if I paid them off this year would be much greater than 7.5% of my household income (wife's salary, my severance, my unemployment, and dividends). However, I am wondering if I do the IRA conversion, will it jack up the income basis for the medical deduction calculation?
I was hoping to convert as much as I can to have an income minus deductions and stay just below $89,450 (filing jointly). This way, I convert and pay only 12% tax on the converted money. So, just fine tuning my conversion amount; if converting eliminates the medical deduction, then I have to reduce the amount converted because I would have a smaller deduction with no medical line item.
