ROTH Conversion

khowarter — Tue, 24 Feb 2026 07:36:02 GMT

I am retiring this year and my earnings put us in the 22% tax bracket. I wil be required to take a distribution from my IRA/401k next year, my wife has 2 more years before she needs to take a distribution. Our Financial Planner has recommended that we convert some of our IRA money to a ROTH IRA this year. We have about $5k estimated refund coming for 2023 when we file our taxes which would cover the taxes on $25k. Does it make sense to convert enough to offset the $5k refund? Or should we leave it alone? In 2024 we should be in the 12% tax bracket.

Re: ROTH Conversion

Paul_W1 — Wed, 25 Oct 2023 18:15:02 GMT

Hello khowarter,

Welcome to today's ask the expert event. Glad to have you. It is my understanding that you have a question about a ROTH conversion. A conversion will be a taxable event which will generate a 1099-R from your financial brokerage firm holding that account. The rule is 20% federal mandatory withholding. In my reading of your question, you provided around $5 for paying the taxes which leads me to believe that you have a conversion of $25k. Without know more specific on additional income sources, this one piece would appear to be on target with your assumptions. I can better assist you with Turbo Tax estimator called TaxCaster. Here is the link. https://turbotax.intuit.com/tax-tools/calculators/taxcaster/ . This estimator is helpful as you input other income sources. This will help your future tax planning as well. Unfortunately we cannot offer tax planning. Hopefully the information I have provided is helpful. Thank you for allowing me to assist you with your question. Have a great rest of the day.

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ROTH Conversion

Re: ROTH Conversion