Many METARs are retired. To minimize taxes, we should pay attention to the Required Minimum Distributions from our IRAs years in advance.
Fidelity expects IRA distributions for clients to reach $25 billion in 2024, which could have major ramifications
By Anne Tergesen, The Wall Street Journal, Jan. 4, 2024
Although tax brackets are adjusted for inflation, the market’s strong performance in 2023 means the higher RMDs will push some retirees into higher tax brackets. It will also require some to pay surcharges on future Medicare premiums, which are based on income. For others, the increases will trigger a 3.8% surtax on net investment income, which kicks in when modified adjusted gross income exceeds $200,000 for single people and $250,000 for married couples, thresholds that aren’t adjusted for inflation.
Also inflating RMDs is Congress, which recently raised the age at which people are required to start withdrawing money from tax-deferred retirement accounts to 73 on Jan. 1, 2023 from 72 and 70½ before that.
That gives investors who can afford to leave their retirement savings untouched the opportunity to let the money grow tax-deferred for longer… [end quote]
I began Traditional-to-Roth IRA conversions a few years ago.
A relatively new law allows tax exemption when an IRA distribution (up to $50,000) is donated to a Charitable Gift Annuity. This provides income as well as a tax exemption.