Subject: Re: Million to Billion
...have questions about the attractiveness to you of the Roth IRA. My take: Having to give the Feds, up front, my fully taxed contribution into a Roth, when I'm at the highest incremental tax rate, didn't make sense to me.

Hi BrerBear. I did a really interesting exercise to challenge my assumption that we would be in a lower tax bracket in retirement. Took all of our TIRAs and looked at what the value of those TIRAs would be when it came to be RMD time, plugging that number into an RMD calculator to see how much we would be forced to take out annually. Even with a super conservative return on equity, we would easily be in the 28% tax bracket, using the 2017 tax brackets as we hit the RMDs after the Trump tax breaks expire. Given the much higher amount of income one can have in the 24% bracket through 2025, we started doing Roth conversions up through the 24% tax bracket. Seemed to be a no brainer. In the very least this will be a better inheritance for our two kids, one of whom is already taxed at a super high level. When we first started maxing out the IRAs, we figured it would be a great way for our kids to inherit, but the changes to inherited IRAs, having to pull all the money out in 10 years, changed our desire for this type of account. Perhaps tax changes are on the way for the Roth as well, but you can only make plans based on what is, rather than what may be. In hindsight, focusing on appreciating assets that only would be taxed for LTCG would possibly have been better, but we've done well, so how can I complain?

HTH,

IP