I'm still figuring out how much I can Roth convert without being subject to IRMAA.
This year I think I'm OK, unless I convert some more. I would not mind converting a little more, but I think I do not understand things. So for now will do nothing.
In the past we converted up to the top of the 12% bracket, so did not have to think about IRMAA.
We live pretty comfortably on just below the top of the 12% bracket, so only converted a little each year.
But this year I inherited an IRA, which has to be empty in 10 years. The inherited IRA is about 20% of our total balance. Which puts us in the 22% bracket, like it or not (I'm not complaining, but I do not want to do something stupid)
I'm OK paying 22% tax instead of 12% tax. But I do not want to pay IRMAA if I can avoid it. My retirement health care plan pays for Medicare, but but does not cover the IRMAA expense.
Unfortunately IRMAA is based on what happened 2 years ago. I can't change that. I used to think I could convert up to the top of the 22% bracket and be OK. But now I am confused.
I think if I want to avoid IRMAA. I need to keep my MAGI below the 22% number, and ignore the standard deduction. Is this correct?
For example, this year my MAGI was about $200k. A good part of that was Roth conversions. The standard deduction is about $32k. So I pay taxes on $168k. I Hope I will not have to pay IRMAA two years from now.
It appears to me that IRMAA is based on MAGI. Not taxable income. Is this correct?
This year I think I'm OK, unless I convert some more. I would not mind converting a little more, but I think I do not understand things. So for now will do nothing.
In the past we converted up to the top of the 12% bracket, so did not have to think about IRMAA.
We live pretty comfortably on just below the top of the 12% bracket, so only converted a little each year.
But this year I inherited an IRA, which has to be empty in 10 years. The inherited IRA is about 20% of our total balance. Which puts us in the 22% bracket, like it or not (I'm not complaining, but I do not want to do something stupid)
I'm OK paying 22% tax instead of 12% tax. But I do not want to pay IRMAA if I can avoid it. My retirement health care plan pays for Medicare, but but does not cover the IRMAA expense.
Unfortunately IRMAA is based on what happened 2 years ago. I can't change that. I used to think I could convert up to the top of the 22% bracket and be OK. But now I am confused.
I think if I want to avoid IRMAA. I need to keep my MAGI below the 22% number, and ignore the standard deduction. Is this correct?
For example, this year my MAGI was about $200k. A good part of that was Roth conversions. The standard deduction is about $32k. So I pay taxes on $168k. I Hope I will not have to pay IRMAA two years from now.
It appears to me that IRMAA is based on MAGI. Not taxable income. Is this correct?
Statistics: Posted by dknightd — Sat Dec 28, 2024 8:41 am — Replies 4 — Views 336
