US IRS: 2025 Tax Brackets

dilettante

dilettante

Well-known Member
Location
Michigan
Changes are broken down pretty simply here:


They've raised brackets, which is a good thing. Retirement account adjustments: still to be determined. A few things did not get inflation-adjusted.

If you don't do your own taxes it may feel like gibberish though.
 

It'll be interesting to see what Congress decides about the ending of the Tax Cuts and Jobs Act scheduled for 12/31/2025.

Our CFP firm is trying to get us to convert some of the taxable portfolio to a Roth IRA, but it's really a wash for us - even our CPA agreed. If one of us dies, yes the survivor will get socked with a higher tax rate, but our main income is a fully taxable state pension with COLA. What we could put in a Roth to lower the survivor's RMD would only pay off if the survivor had a long expected lifespan.

Unfortunately, Spouse and I have at best average mortality, and in fact his mortality is shaded towards dementia (stroke victims have a much higher risk of developing dementia, even if stroke-free free for 20 yrs). It's a big reason why we have LTCi policies. Having tax-free funding for memory care is worth the expensive premiums.

It would have been great if Roths had been available when we were working, but they weren't. Definitely worth it for younger folks, however!
 
Maybe we'll get lucky and SS will go untaxed in the near future.

Otherwise when I take SS and then my RMDs... big tax bite from the two combined along with the Medicare surcharges under IRMAA.

That's why I want to squeeze through some Roth conversions before I take SS in under 2 years. I wish I'd known enough to do so before 65 when Medicare kicked in.

Juggling the numbers to see what makes sense now. I'll probably have to take a big IRMAA hit for a couple of years to make it happen. Sadly IRMAA has that 2 year overshadow/lookback thing within it, so I'll have to figure out that complication.
 
Lethe200 said:
It'll be interesting to see what Congress decides about the ending of the Tax Cuts and Jobs Act scheduled for 12/31/2025.

Our CFP firm is trying to get us to convert some of the taxable portfolio to a Roth IRA, but it's really a wash for us - even our CPA agreed. If one of us dies, yes the survivor will get socked with a higher tax rate, but our main income is a fully taxable state pension with COLA. What we could put in a Roth to lower the survivor's RMD would only pay off if the survivor had a long expected lifespan.

Unfortunately, Spouse and I have at best average mortality, and in fact his mortality is shaded towards dementia (stroke victims have a much higher risk of developing dementia, even if stroke-free free for 20 yrs). It's a big reason why we have LTCi policies. Having tax-free funding for memory care is worth the expensive premiums.

It would have been great if Roths had been available when we were working, but they weren't. Definitely worth it for younger folks, however!
Click to expand...
When did you and your husband retire? I must have converted to a Roth as soon as it became available. Doing so has paid off nicely. It IS too bad you couldn't have taken advantage of it sooner.
 

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