First of all, thanks very much for a wonderful tool! I’ve only begun to scratch the surface on everything this provides!

I’ve uncovered a slight error on the Personal Finance Toolbox under the “Misc. calcs” tab, cell B165, Marginal tax rate of conversion when funds from a taxable account are used to pay for taxes due to conversion.

I posted on the Bogleheads forum regarding this topic:

https://www.bogleheads.org/forum/viewtopic.php?p=7664389#p7664389I’ll provide a short description:

To calculate the marginal tax rate, you divide the (change in tax) by (change in income). The formula in B165 correctly calculates the change in tax when selling funds in a taxable account to pay for the taxes resulting from the tIRA transfer, but it does not account for the additional income resulting from the sale of taxable funds.

I’ll provide a quick example:

In my case, I pay any expenses not covered with interest and dividends by selling funds in my taxable account. Here's my assumptions:

- 24% federal only tax bracket

- NIIT of 3.8% and 50% cost basis/current value in the taxable account so the marginal tax becomes (15% + 3.8%)*50% = 9.4% on any additional fund sales,

- No other income, no SS, no pension, etc.

- $10k tIRA to Roth conversion

If I pay for the conversion with simple withholding, the marginal rate is a simple 24% or 2400/10000.

If I choose to pay the taxes by liquidating a taxable asset with 50% cost basis, I need to sell $2649 of the asset resulting in $2649 additional income and $249 in taxes.

Cell B165 currently calculates the marginal rate at 26.49% using the numbers above when the actual marginal rate should be (2400+249)/(10000+2649) = 20.94%

A formula that yields the correct marginal rate calculation is:

=B162/(1-B163*(1-B164))/(1+B162/(1-B163*(1-B164)))

(note, I didn’t take time to algebraically simplify the formula)

Thanks again for the spreadsheet and attention to this error.