The Best Time To Convert To a Roth IRA During The Year

Apr 28, 2022

The theme this week on the Retirement Quick Tips Podcast is: Does It Matter When You Convert To a Roth IRA or 401k? 

Today, I’m talking about the Best Time To Convert To a Roth IRA During The Year- market downturn, lower taxes (early years of retirement or semi-retirement), now while you still can

1. In 2021, there was a proposal in the House to eliminate Roth conversions for Americans in the top income brackets. It was part of the Build Back Better bill that didn’t have the votes to pass, so it’s been punted for now. 
2. But Roth rules, especially for higher income earners are always on the table for changes. 
3. Prior to 2010, Your adjusted gross income needed to be below $100,000 to convert a traditional IRA into a Roth. In 2010, the $100,000 income limit disappeared, and anyone can now convert to a Roth
4. But you can see that the tax rules around Roth conversions are always pretty active. It’s low hanging fruit when Congress considers raising taxes, because it will still raise hundreds of millions of additional tax revenue over a number of years, without the pain of raising the taxes that comes out of each one of your paychecks. 

That’s it for today. Thanks for listening! My name is Ashley Micciche and this is the Retirement Quick Tips podcast. 

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Tags: retirement, investing, money, finance, financial planning, retirement planning, saving money, personal finance