How Tax Choices Shape Retirement Income
Taxes may not be anyone’s favorite retirement topic, but they can have a real effect on how much of your money stays available for the life you want.
In this episode of Kitchen Table Finance, Nick Nauta is joined by Cole Williams, who is filling in for Dave Shotwell. They talk about the role taxes play in a retirement income plan and why tax planning often goes beyond filing a return each spring.
The conversation starts with three common account types:
- Pre-tax retirement accounts
- Roth accounts
- Taxable accounts
Each has different tax treatment, and having money spread across more than one type can create more choices when retirement income begins.
Nick and Cole then discuss what can happen during the lower-income years after retirement and before Social Security or required minimum distributions begin. Those years may create room for Roth conversions or other taxable moves at lower rates.
They also cover the 0% federal long-term capital gains bracket and how realizing gains in a taxable account may help raise cost basis when the numbers fit. Because Roth conversions and gain harvesting must be completed during the tax year, the conversation explains why year-end tax planning deserves attention before December 31.
The episode also covers required minimum distributions and why larger pre-tax balances can reduce your control over future taxable income. Nick and Cole discuss Medicare income-related premium adjustments, marketplace health insurance subsidies, Social Security taxation and other thresholds that can change the result of a tax move.
Finally, they look at legacy planning. Taxable accounts, Roth accounts and pre-tax retirement accounts can each create different tax results for heirs, so beneficiary goals belong in the retirement tax conversation too.
Topics discussed:
- Traditional 401(k)s and IRAs
- Roth IRAs and Roth 401(k)s
- Taxable brokerage accounts
- Tax diversification
- Retirement tax bracket management
- Roth conversions
- 0% long-term capital gains
- Required minimum distributions
- Medicare premium adjustments
- Marketplace health insurance subsidies
- Social Security taxation
- Beneficiary and legacy tax planning
- Year-end retirement tax planning
Need Help With Taxes and Your Retirement Income?
Contact SRB today at 517-321-4832 or email us at info@srbadvisors.com.
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