Question 1

What is the best tax strategy for retirement?

Accepted Answer

There is no single best strategy — it depends on your current bracket, projected future bracket, account mix, Social Security timing, and estate goals. The most impactful levers are: (1) Roth conversions during low-income years before RMDs begin, (2) income sequencing — drawing from taxable accounts first to let tax-deferred accounts compound, (3) QCDs to satisfy RMDs without adding to taxable income, and (4) beneficiary designations that minimize the tax burden on heirs. Doug models all four in the context of your specific numbers.

Question 2

When is the best time to do a ROTH conversion?

Accepted Answer

The optimal Roth conversion window is typically the years between retirement and age 73 — when RMDs begin. During this window, income is often at its lowest: no salary, Social Security not yet claimed, and no RMDs yet. Converting pre-tax IRA assets to Roth during this window fills the lower tax brackets at a lower cost than converting later when RMDs are forcing distributions. The exact conversion amount each year depends on your bracket, Medicare premium thresholds (IRMAA), and estate goals.

Question 3

How do Required Minimum Distributions affect my taxes?

Accepted Answer

RMDs are taxed as ordinary income in the year they are taken. If your IRA is large — say $1 million or more — the RMDs at 73 can be $40,000 to $60,000 per year, on top of Social Security and any pension income. This can push you into the 22% or 24% federal bracket, increase your Medicare Part B and D premiums (IRMAA surcharges), and make more of your Social Security taxable. Reducing the IRA balance through Roth conversions before 73 directly reduces the RMD amount.

Question 4

What is a Qualified Charitable Distribution (QCD)?

Accepted Answer

A QCD is a direct transfer from your IRA to a qualified 501(c)(3) charity. You must be 70½ or older to use a QCD. The amount transferred — up to $105,000 per year in 2024 — is excluded from your taxable income entirely. This is more tax-efficient than taking the RMD as income and then donating it, because the QCD reduces your AGI directly. A lower AGI reduces Medicare IRMAA surcharges, reduces the taxable portion of Social Security, and may keep you in a lower bracket.

Question 5

How are inherited IRAs taxed under the SECURE Act?

Accepted Answer

Under the SECURE Act (2019) and SECURE 2.0 (2022), most non-spouse beneficiaries who inherit an IRA must distribute the entire account within 10 years of the original owner's death. There are no annual RMD requirements during the 10-year period, but the full balance must be distributed by the end of year 10. Every distribution is taxed as ordinary income. If the beneficiary is in a high-income year — prime earning years — the tax cost can be significant. Roth conversions by the original owner reduce the inherited balance and shift the tax burden from the beneficiary to the owner at a potentially lower rate.

Question 6

Does New York State tax retirement income?

Accepted Answer

New York State exempts Social Security benefits from state income tax. New York also exempts up to $20,000 per year of pension income for taxpayers 59½ or older — this applies to both public and private pensions. IRA distributions are not exempt and are taxed as ordinary income at the state level. New York City residents pay an additional city income tax on top of state tax. For NYC residents, the combined federal, state, and city marginal rate can exceed 50% in the top bracket — making Roth conversions and income sequencing particularly valuable.

Tax Planning for Retirement
New York

Tax Planning Services for New York Retirees

ROTH Conversion Strategy

ROTH Conversion — Public Sector

Required Minimum Distributions

Qualified Charitable Distributions

IRA Beneficiary Planning

Retirement Income Planning

New York Tax Context

Social Security

Pension Income

IRA Distributions

IRMAA Surcharges

What should New York retirees know about tax planning?

Build Your Retirement Tax Strategy

Tax Planning for RetirementNew York