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PDtax
PDtax, CPA, MBA
Category: Finance
Satisfied Customers: 4104
Experience:  Tax professional and business consultant for 35 years.
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I am in a no-income year having retired a year and a half

Customer Question

I am in a no-income year having retired a year and a half ago from an independent school. I will begin drawing from my TIAA account in January. I have been living on personal savings and taking care of my parents. My question is how do I know if I should cash in other non-retirement savings for tax purposes this year, or convert part of a traditional IRA to a Roth? Thanks.
Submitted: 1 year ago.
Category: Finance
Expert:  PDtax replied 1 year ago.

Hi from Just Answer. I'm PDtax, and see you have a great planning opportunity.

Expert:  PDtax replied 1 year ago.

Your pension start in 2016 gives you the opportunity to accelerate income into 2015 at no to little tax.

I like the idea of a Roth conversion, especially if you are over 59 1/2 to avoid the 10% penalty. The tax hit will be the lowest you will ever have, and you will have 0% tax on the standard deduction and exemption amount for 2015.

If you have the opportunity to recognize capital gains, this could be the year for that as well. Your non-retirement savings might be just such an opportunity.

Expert:  PDtax replied 1 year ago.

I am assuming you have $0 income, and suggest that you forecast the results with good tax software to evaluate your opportunities. Thanks for asking at Just Answer. Positive feedback is appreciated. I'm PDtax.

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