Craig Wear explains how large IRAs trigger required minimum distributions that push you into higher Medicare premiums and Social Security taxes. Aggressive Roth conversions let you control when you pay taxes instead of facing a bigger bill later.
People say if I do Roth conversions, more of my Social Security will be taxed. That's true, it will be. But again, only for a short period of time. Let's look at it like this. If you have a large ira, that account keeps growing, that's filling up your future required minimum distributions or RMDs bucket, and eventually those RMDs force income on you whether you want it or not. That means higher Medicare premiums, more Social Security being taxed. So at the end of the day, you're going to end up with higher Medicare premiums and Social Security tax anyway, whether you do conversions or not. Aggressive Roth conversions are not creating a problem, they're front running a problem that already exists, allowing you to do it when it's beneficial to you, as opposed to just kind of rolling with the punches. You're choosing when to pay the tax instead of letting the system choose for you.
