seionage wrote:I'm a physician in the mid-stage of my career (age 45 and been in practice since 1999). I contribute the maximum to my group's available tax-deductible plans (401k and HSA) every year. Can I assume that, when I retire, I will actually be in a lower tax bracket than I am in now? If the answer is "most likely, yes", then does it make any sense to convert tIRA and non-deductible IRA accounts to Roth IRAs?
How much post-tax contributions are in the TIRA accounts compared to the total balance? Roths are much better than non-deductible TIRAs because they are never taxed and are not subject to RMDs. Earnings of non-deductible contributions to TIRAS are. What tax rate will apply in converting the whole TIRA mess to a Roth now before it grows any bigger? Once you do it you can do annual backdoor Roths without any tax burden forevermore. If you are in Texas you don't have state tax on the conversion. I would do it at least to the top of the 28% if you have the space. You don't have to do it all at once..... could stretch if out over several years and just keep the non-deductible contributions going since the contributions portion doesn't get taxed twice.
If you plan to retire early and have years to convert in a low bracket you could wait but if you can afford this conversion now I would not. That lower bracket in retirement turned out to be mythical for me.