A main focus of retirement planning is deferring taxes, but the results of a recent study raises questions on whether accelerating taxes on retirement accounts may sometimes be a beneficial move. The Vanguard study revealed that many 401(k) and IRA account holders are not using distributions from the accounts for income. Even though a Roth conversion can accelerate tax consequences, it can also have estate planning benefits for inheriting beneficiaries since the accounts do not have required minimum distributions.
See Mark Miller, When Paying Taxes on Retirement Accounts Makes Sense, Wealth Management, Dec. 12, 2014.
Special thanks to Jim Hillhouse (Professional Legal Marketing (PLM, Inc.)) for bringing this article to my attention.
