estimating Roth conversion amount

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go_mets
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Joined: Wed Oct 21, 2015 11:49 am

estimating Roth conversion amount

Post by go_mets » Fri Nov 02, 2018 9:55 am

Unless something unforeseen happens in the next 60 days, I may have to make a Roth conversion this year to get above 138% of FPL for my 2018 taxes so I don't fall into Medicaid for my health insurance.

Is there software or an online website that can help me with this?

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jebmke
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Joined: Thu Apr 05, 2007 2:44 pm

Re: estimating Roth conversion amount

Post by jebmke » Fri Nov 02, 2018 1:02 pm

I would prepare a pro-forma tax return and then use these guidelines to calculate the MAGI

https://www.healthcare.gov/income-and-h ... to-report/
When you discover that you are riding a dead horse, the best strategy is to dismount.

delamer
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Re: estimating Roth conversion amount

Post by delamer » Fri Nov 02, 2018 1:46 pm

You can use TaxCaster to do an estimate of your taxable income.

Just make sure you are looking at the 2018 result, not 2017.

jebmke
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Re: estimating Roth conversion amount

Post by jebmke » Fri Nov 02, 2018 2:10 pm

The more I think of it, it really doesn't even need to be a tax return. Once you know the major income items it should be pretty simple -- we aren't interested in the tax amount, partly because, at this level of income, there probably isn't a tax issue.
When you discover that you are riding a dead horse, the best strategy is to dismount.

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Peter Foley
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Re: estimating Roth conversion amount

Post by Peter Foley » Fri Nov 02, 2018 2:27 pm

If you use Turbo tax there is a form you can print out called 2 year comparison. I used the output of that form to create an excel spreadsheet which I use to project future year adjusted gross income, taxable income, and estimated tax liability. That spreadsheet had been useful in planning Roth conversions and withholdings.

I've also created templates for different groups (accumulators, retirees with SS benefits, retirees w/o SS benefits) for BH discussion groups.

PM me if you are interested in seeing one.

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FiveK
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Re: estimating Roth conversion amount

Post by FiveK » Fri Nov 02, 2018 4:18 pm

go_mets wrote:
Fri Nov 02, 2018 9:55 am
Is there software or an online website that can help me with this?
The "what if?" worksheets of TurboTax, TaxAct, etc. may be the most accurate if one has an extremely complex situation.

If one has merely a "somewhat complex" situation, various web-based and spreadsheet programs are available. To date, the personal finance toolbox spreadsheet has been the most accurate (i.e., using 2018 instead of 2017 tables, including more credits, phaseouts, etc.).

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