CONTACT US
Enter your Name, Email Address and a short message. We'll respond to you as soon as possible.
1021223-00006-00
Advisor Name, designations
Financial Professional
Prudential Advisors
236 Broadway
Menands, NY 12204
Phone: 800-243-5334
Fax: 800-720-0780
Email: sales@ltmclientmarketing.com
Website: letstalkfinancialwellness.com
July/August 2025
Make a Roth IRA Conversion
If you're nearing or in retirement and concerned about paying too much in taxes, you may want to convert a portion or all of your taxable retirement plan assets to a tax-free Roth IRA*. Here's how it works.
Overcoming Obstacles
A major concern for many people considering a Roth conversion is their tax bill. The amount you convert from a tax-deferred retirement plan, such as a 401(k) or a traditional IRA, is considered a distribution and is added to your taxable income in the year you convert. This can create a larger tax bill than expected and potentially move you into higher income tax brackets.If you're nearing retirement but still working, the extra income can also cause you to become ineligible for current contributions to an existing Roth IRA. In 2025, contribution amounts begin to be limited when modified adjusted income hits $236,000 and phase out completely at $246,000 for taxpayers who are married and filing jointly. Limits for single and head of household filers phase out between $146,000 and $165,000.** But you do have alternative ways to save if that's the case.
Little by Little
Consider converting portions of tax-deferred retirement account assets in order to meet the income qualifications and keep your Roth IRA contribution eligibility. In this way, you spread out the conversion tax bill over time. If you were still working in 2024, you can contribute up to $7,000 to an IRA. If you're at least age 50, you can add another $1,000 in catch-up contributions.Unlike traditional retirement accounts, the Roth IRA is not subject to what's known as required minimum distributions (RMDs), so, you needn't take a Roth distribution in your lifetime. Your financial professional can tell you more.
* Converting from a traditional IRA to a Roth IRA is a taxable event. A Roth IRA offers tax free withdrawals on taxed contributions. To qualify for the tax-free and penalty-free withdrawal of earnings, a Roth IRA must be in place for at least five tax years, and the distribution must take place after age 59ó or due to death, disability, or a first-time home purchase (up to a $10,000 lifetime maximum). Roth IRA distributions may be subject to state taxes.
**IRS.gov
718158
Life insurance is issued by The Prudential Insurance Company of America, Newark, NJ, and its affiliates. Securities products and services are offered through Pruco Securities, LLC (Pruco) (member SIPC). Prudential and its representatives do not give tax or legal advice. Please consult with your own advisors regarding your particular situation. Prudential, the Prudential logo, and the Rock Symbol are service marks of Prudential Financial Inc., and its related entities, registered in many jurisdictions worldwide. Prudential Advisors is a brand name of The Prudential Insurance Company of America and its subsidiaries.
This newsletter is general educational information provided by a Prudential Financial Professional and is not intended to market or sell any specific products and services, but rather provide general information about the subject matter covered only.
Prudential Advisors and LTM Marketing Specialists LLC are unrelated companies. This publication was prepared for the publication’s provider by LTM Marketing Specialists LLC, an unrelated third party. Articles are not written or produced by the named representative.
The information and opinions contained in this web site are obtained from sources believed to be reliable, but their accuracy cannot be guaranteed. The publishers assume no responsibility for errors and omissions or for any damages resulting from the use of the published information. This web site is published with the understanding that it does not render legal, accounting, financial, or other professional advice. Whole or partial reproduction of this web site is forbidden without the written permission of the publisher.