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Beneficiary

Roth Conversions and Stretch IRAs: Today's Slott Report Mailbag

Question: Could you please direct me to information that tells me how any conversions I make from my regular IRA to a Roth will be taxed. My belief was that the amount of any conversion will be taxed at whatever my tax bracket is for the year in which I make the conversion. Is that correct? Therefore, all other things being equal, it is preferable to make the conversion in years where my tax bracket is lower. Thanks for your help. Joann Answer: Joann, You are 100% correct. Any conversion from a traditional to a Roth IRA will be taxed at your tax bracket for the year in which you make the conversion. (One is not allowed to make a “prior year conversion.”) As for your second comment – also yes.

Which Life Expectancy Table Do I Use?

When it comes time to calculate your required minimum distribution (RMD) from your IRA, you may wonder which life expectancy table to use. Last updated by the IRS back in 2002, there are three possible tables for IRA owners and beneficiaries, and they can all be found in IRS Publication 590-B. The three tables are the Uniform Lifetime Table, the Joint Life Expectancy Table, and the Single Life Expectancy Table. Uniform Lifetime Table If you are taking RMDs from your IRA during your lifetime, this is most likely going to be your table. This table is used by most IRA owners for figuring lifetime RMDs from their IRAs. The only IRA owners who will not use this table are those whose spouse is their sole beneficiary for the entire year and is more than 10 years younger.

Commingling Inherited Assets and QCDs: Today’s Q&A Mailbag

This week's Slott Report Mailbag answers readers' questions about commingling assets and QCDs.

How Much Can a Stretch IRA Be Worth?

One of the greatest benefits of an IRA is its ability to provide tax-favored wealth for heirs. An IRA left to a beneficiary can be "stretched" to provide pre-tax compound investment returns for the rest of the beneficiary's life -- or even longer. And these can be distributed totally tax free if it is a Roth IRA.

Rollovers, Spouse as the Beneficiary, and Backdoor Roth: Today’s Q&A Mailbag

This week's Slott Report Mailbag answers readers' questions about rollovers, spouse as the beneficiary, and the backdoor Roth.

Do You Know All the Rules for Rolling Over a Roth 401(k)?

This week's Slott Report Mailbag examines 401(k)s, Roth 401(k)s, and spousal beneficiary rules.

Inheriting an Inherited IRA

What are the rules when you inherit an inherited IRA? We get this question frequently. Let’s consider what happens when using designated beneficiaries.

Calculating RMDs with Multiple Beneficiaries: This Week’s Q&A

This week's Slott Report Mailbag looks into calculating RMDs with multiple beneficiaries and inheriting IRAs.

Have You Faced This Dilemma with Spousal Contributions? This Week’s Q&A

This week's Slott Report Mailbag looks into IRA beneficiaries, Roth IRAs, and spousal contributions.

The 99% Rule for Spousal Beneficiaries of Retirement Accounts

It sounds funny to say, but death is a part of life for all of us. It’s one of the few things that all of us have in common at some point, and it’s one of the few issues that must be addressed in every plan. While every situation is unique and we all have our own goals and objectives, the overwhelming majority of married couples with IRAs and other similar accounts, such as 401(k)s and 403(b)s, name their spouse as their primary beneficiary as part of their estate plans. As such, knowing the rules for when a spouse inherits an IRA is critical for just about every married couple.

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