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Learning, Sharing, and Teaching => Taxes => Topic started by: GOFU on February 06, 2018, 06:22:44 PM

Title: Roth Conversions and Harvesting Capital Gains - need formulas not concepts
Post by: GOFU on February 06, 2018, 06:22:44 PM

I have read a million articles on the concepts of (1) converting tIRA to Roth, and (2) harvesting capital gains without paying LTCG tax.

What I am looking for is a formula to establish how much can be done in any given tax year. Something like:

$X - AGI = LTCG at 0%

or whatever the formula happens to be.

Same thing for tIRA conversions to Roth. How do I calculate the actual amounts so I can decide how to make the moves?

Also, do I have until the tax filing deadline to do any Roth conversions for 2017, or is there another deadline?

Thanks!

Title: Re: Roth Conversions and Harvesting Capital Gains - need formulas not concepts
Post by: MDM on February 06, 2018, 06:52:01 PM

Conversions are subject to tax for the year in which they occur.  E.g., tax on any conversion done in 2018 will be subject to the 2018 tax on the return you file in 2019.

Feel free to peruse the case study spreadsheet (http://forum.mrmoneymustache.com/forum-information-faqs/case-study-spreadsheet-updates/) for various tax formulas.

Taxation of LTCG will depend on
- Total income
- Sources of income (LTCG, ordinary income, SS benefits, etc.)
- Filing status

Given a simple situation, there are simple formulas.  But the general case is more complex.

Title: Re: Roth Conversions and Harvesting Capital Gains - need formulas not concepts
Post by: GOFU on February 06, 2018, 07:24:10 PM

@MDM thank you I will work on that for a while