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Michael A. Milazzo, CLU, ChFC
Registered Principal
The Meridian Financial Company
3350 Club Villas Dr SE, Unit #1303
Southport, NC 28461
Phone: 631-979-4223
Fax: 910-854-0002
Email: meridian@ae.cadaretgrant.com
Website: www.merfinco.com
If you’re nearing or in retirement and concerned that income tax rates will rise, 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.
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 2018, income limits begin at $189,000 and phase out at $199,000 for taxpayers who are married and filing jointly or heads of households, with limits for single filers phasing out between $120,000 and $135,000.** But you do have alternatives if that’s the case.
Qualified Roth IRA distributions are tax-free after age 59 1/2 if you have owned the IRA at least five years. Unlike traditional retirement accounts, the Roth IRA is not subject to what’s known as required minimum distributions (RMDs), which must begin at age 70 1/2. In fact, you needn’t take a distribution from a Roth 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 taxable 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 59 1/2 or due to death, disability, or a first time home purchase (up to a $10,000 lifetime maximum). Depending on state law, Roth IRA distributions may be subject to state taxes.
** https://www.irs.gov/retirement-plans/plan-participantemployee/amount-of-roth-ira-contributions-that-you-canmake-for-2018
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Securities and Advisory Services offered through Cadaret, Grant & Co, Inc, a Registered Investment Advisor and Member FINRA/SIPC. The Meridian Financial Company and Cadaret, Grant & Co., Inc. are separate entities. I am registered to sell Securities in the following States: NY, NJ, PA, NC, FL, ID.
The Meridian Financial Company and LTM Marketing Specialists LLC are unrelated companies. This publication was prepared for the publication’s provider by LTM Client Marketing, an unrelated third party. Articles are not written or produced by the named representative.
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