AKD Consultants
Adam Dworkin
CPA
188 Whiting Street
Suite 10
Hingham, MA 02043
781-556-5554
Adam@AKDConsultants.com
 
 




Roth IRA Conversion Calculator (Advanced)
Roth IRA Conversion Calculator (Advanced)

With a Roth conversion, the taxable portion of your traditional IRA (deductible contributions and earnings) is subject to tax in the year of conversion. This calculator compares two scenarios: (1) The full or partial conversion of a traditional IRA to a Roth IRA, and (2) No traditional-to-Roth conversion. The calculator assumes that you'll pay any conversion taxes from other assets, and determines (for scenario 2) the amount you could have earned on that "side fund" had you not converted. For both scenarios, all required minimum distributions (RMDs) are also assumed to be invested in the side fund. The calculator estimates the IRA accumulation, and RMD distributions, for the IRA owner and up to three beneficiaries, (you can specify one spouse beneficiary and up to two non-spouse beneficiaries). Total after-tax dollars are compared.

Part One: General Information
Current Age
End projection for IRA owner at age
Current traditional IRA balance $
Nontaxable amount allocated to IRA* $
Percent of IRA to be converted %
Part Two (Optional): Show distributions to beneficiaries?

Select "Yes" if you want to project amounts for beneficiaries

Spouse beneficiary (assumes rollover to own IRA)
Percent of IRA proceeds at death % Current Age
Nonspouse beneficiary(ies)
Nonspouse Beneficiary 1-- % of IRA proceeds at death % Current Age
Disabled or chronically ill? Child of IRA owner?
Nonspouse Beneficiary 2-- % of IRA proceeds at death % Current Age
Disabled or chronically ill? Child of IRA owner?
Prorate distributions when subject to 10-year rule?

* If you have multiple traditional IRAs, you must pro-rate your nontaxable balance among them. The IRS provides a worksheet in Publication 590-B.

Conversion taxes are paid from other assets.

The general RMD starting age is age 72.

Lifetime RMD calculation does not account for special rules that apply when spouse is more than 10 years younger than IRA owner.

Death occurs on last day of the year. The IRA owner is generally treated as dying before the required beginning date if death occurs at age 72 or earlier. A Roth IRA owner is always treated as dying before the required beginning date.

Conversion occurs at beginning of year.

Federal estate tax and possible credit for estate taxes paid are not accounted for; state income and death taxes and credits are also not taken into account.

All taxes are paid at end of year incurred.

RMDs are deposited into a side fund and grow at the specified annual rate of retiurn. Amount(s) equivalent to any conversion tax that would be owed as a result of the Roth conversion are also deposited into the side fund and grow at the specified annual rate of return.

Assumes spouse beneficiary rolls over inherited IRA to own IRA, and RMDs start when spouse reaches age 72.

Owner's life expectancy may be taken into account for RMDs of a nonspouse beneficiary if the owner dies on or after the required beginning date.

Assumes separate accounts established for beneficiaries--beneficiaries' own life expectancy may be taken into account for RMDs if the IRA owner dies on or after the required beginning date, or if the designated beneficiary is an eligible designated beneficiary.

An eligible designated beneficiary is a designated beneficiary who is: the spouse or minor child of the IRA owner, disabled or chronically ill, or an individual no more than 10 years younger than the IRA owner. If the designated beneficiary is not an eligible designated beneficiary, the entire account must also be distributed 10 years after the death of the IRA owner. Also, when a minor child eligible designated beneficiary reaches age 21, the entire account must also be distributed within 10 years after such year.

Assumptions:



IMPORTANT DISCLOSURES Broadridge Investor Communication Solutions, Inc. does not provide investment, tax, legal, or retirement advice or recommendations. The information presented here is not specific to any individual's personal circumstances. To the extent that this material concerns tax matters, it is not intended or written to be used, and cannot be used, by a taxpayer for the purpose of avoiding penalties that may be imposed by law. Each taxpayer should seek independent advice from a tax professional based on his or her individual circumstances. These materials are provided for general information and educational purposes based upon publicly available information from sources believed to be reliable — we cannot assure the accuracy or completeness of these materials. The information in these materials may change at any time and without notice.
Prepared by Broadridge Investor Communication Solutions, Inc. Copyright 2022.