I am assisting my mother with her portfolio as she nears full retirement, but have a general question on how MRDs can shift AA. For example, she has roughly a 50/50 portfolio set-up as follows:

50% Taxable (3 fund equity index portfolio), roughy $300k

50% Tax-advantaged ($50k ROTH and $250k Traditional IRA all invested in Total Bond Index and TIPS fund), roughly $300k

====

Set up this way, we strived to make it the most tax-friendly as possible by placing the equity funds in her taxable account. As she gets nearer to having to take her MRDs (or even general living expenses once she full retires in several more years), this would impact the AA. Further, she would like to get a little more conservative - perhaps 40/60 or even 30/70 as she approaches her 70s and 80s.

So, when the MRDs come out (assuming she does not need to spend the money and wants to reinvest), what is the best way to "re-invest"? She is in the 25% tax bracket, so I thought about municipal bonds. Certainly a generic total bond index seems out of the question in the taxable account, at least from a tax standpoint.

Am I missing something?

One other thought I had was to convert the T-IRAs to Roth, which would negate the need for MRDs altogether).