What Are the Tax Benefits of Roth Conversions in Retirement?
Roth conversions are one of the most powerful retirement tax strategies. By moving funds from a traditional IRA or 401(k) into a Roth IRA, retirees in Oklahoma can lock in tax benefits that last for decades. But how does it work, and is it right for you?
How Roth Conversions Work
You pay taxes now on the converted amount, but future withdrawals are tax-free. This strategy is especially powerful in years when your income is lower than usual.
Tax Benefits
- Reduced RMDs: Roth IRAs have no required minimum distributions.
- Tax-free growth: All future withdrawals are tax-free if rules are followed.
- Estate planning: Heirs inherit tax-free assets.
- Medicare savings: Lower taxable income can reduce Medicare premiums.
When to Consider a Roth Conversion
The best time is often the “retirement gap years”—after retiring but before RMDs begin at 73. During these years, you may be in a lower tax bracket, making conversions cheaper.
Anchor’s Approach
Anchor Financial Group uses advanced tax modeling to show Oklahoma retirees the long-term impact of Roth conversions.
Roth conversions can save thousands in retirement. Anchor helps you decide if it’s the right move.