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roth conversion

Posted: Tue Mar 24, 2020 11:29 am
by Dahl49
Is there a Vanguard roth conversion calculator I can use? Or another one that is available?

thank you

Re: roth conversion

Posted: Tue Mar 24, 2020 12:17 pm
by curmudgeon
Dahl49 wrote:
Tue Mar 24, 2020 11:29 am
Is there a Vanguard roth conversion calculator I can use? Or another one that is available?

thank you
What are you trying to calculate? Current taxes? Potential future value? There have been a number of discussion threads here in the past.

Re: roth conversion

Posted: Tue Mar 24, 2020 5:01 pm
by Vanguard Fan 1367
Dahl49 wrote:
Tue Mar 24, 2020 11:29 am
Is there a Vanguard roth conversion calculator I can use? Or another one that is available?

thank you
I am looking for some Roth information and got referred from the Wiki to Vanguard for a calculator that may have been removed. I couldn't find it.
There have been some changes with the Roth information and Vanguard says that they are working on updating their information.

I also am wondering if there is a good calculator to see if Roth Conversion makes sense in my situation. Would it be something to do to post my information and have the Bogleheads weigh in on what they think?

Re: roth conversion

Posted: Tue Mar 24, 2020 5:04 pm
by FiveK
Vanguard Fan 1367 wrote:
Tue Mar 24, 2020 5:01 pm
...to see if Roth Conversion makes sense in my situation.
It usually boils down to the marginal tax rate you would pay to convert now, vs. what you expect the marginal tax rate would be if you convert later.

See Traditional versus Roth - Bogleheads for details.

Re: roth conversion

Posted: Wed Mar 25, 2020 11:21 am
by Vanguard Fan 1367
FiveK wrote:
Tue Mar 24, 2020 5:04 pm
Vanguard Fan 1367 wrote:
Tue Mar 24, 2020 5:01 pm
...to see if Roth Conversion makes sense in my situation.
It usually boils down to the marginal tax rate you would pay to convert now, vs. what you expect the marginal tax rate would be if you convert later.

See Traditional versus Roth - Bogleheads for details.
I am in a situation where I am 67 and not taking Social Security till 70. I retired in October so my income isn't very high now. Thanks for the suggestion on the marginal tax rate. I need to see what sort of RMD's I will be looking at when I turn 72. I have been a good squirrel and saved in my tax deferred accounts. So probably it would be a good idea to do some sort of conversion.

Thanks for the input.

Re: roth conversion

Posted: Wed Mar 25, 2020 12:04 pm
by Retiredron
I recommend you create a simple spreadsheet looking at your estimated taxable income now through your mid 70s to understand where your tax rates will be. Also note that if you can't pay the conversion tax from your taxable assets Roth conversions probably don't make sense for most. You also have to assess impact on your Medicare premiums, if any.

Re: roth conversion

Posted: Wed Mar 25, 2020 12:15 pm
by FiveK
Retiredron wrote:
Wed Mar 25, 2020 12:04 pm
...if you can't pay the conversion tax from your taxable assets....
That becomes the Simplest situation to analyze.

If one does pay the conversion tax from cash on hand, see the first of the "More complicated situations" immediately following the above link: in that case, a Roth conversion may be more favorable than otherwise.

Re: roth conversion

Posted: Wed Mar 25, 2020 10:21 pm
by Vanguard Fan 1367
Dahl49 wrote:
Tue Mar 24, 2020 11:29 am
Is there a Vanguard roth conversion calculator I can use? Or another one that is available?

thank you
https://www.bogleheads.org/wiki/Retiree_Portfolio_Model

I downloaded the calculator but haven't taken the time to learn how to use it.

RMD 2020

Posted: Tue Apr 14, 2020 11:05 am
by Dahl49
The CARE ACTS allows 2020 RMD that has been taken in can be reversed and put back into IRA. does anyone know if vanguard allows this?

Thanks

Re: roth conversion

Posted: Tue Apr 14, 2020 10:44 pm
by RetiredCSProf
Along with tax brackets, you may also want to look at IRMAA brackets, which affect Medicare premiums.

Re: RMD 2020

Posted: Wed Apr 15, 2020 1:31 am
by Eagle33
Dahl49 wrote:
Tue Apr 14, 2020 11:05 am
The CARE ACTS allows 2020 RMD that has been taken in can be reversed and put back into IRA. does anyone know if vanguard allows this?

Thanks
VG should, but I expect you will need to do this by calling VG to have them explain the process they use and any forms. etc. that are necessary. I don't see any DIY online for this type of rollover.

Re: roth conversion

Posted: Wed Apr 15, 2020 8:17 am
by MJS
To calculate your future income for tax estimation, you will need to estimate your future RMDs. The IRS plans to update their Life Expectancy Tables real soon now. All current RMD calculators use the old Life Expectancy Tables which assume shorter life spans.

So tools like https://www.schwab.com/ira/understand-i ... lators/rmd have been adjusted for the new age 72 start date, but estimate a higher than likely RMD -- if the Updated Life Expectancy Tables are established.

Re: roth conversion

Posted: Wed Apr 15, 2020 8:57 am
by OhioGozaimas
To "reverse" an early-March RMD distribution, I called Vanguard. The CSR transferred me to a "retirement specialist" who undid the distribution on the phone. Total time, about five minutes.

Re: RMD 2020

Posted: Wed Apr 15, 2020 9:22 am
by pshonore
Dahl49 wrote:
Tue Apr 14, 2020 11:05 am
The CARE ACTS allows 2020 RMD that has been taken in can be reversed and put back into IRA. does anyone know if vanguard allows this?

Thanks
Yes, provided you return it within 60 calendar days and have not done a similar rollover within the past 12 months