Almost exactly a year ago, I pondered whether to convert my Traditional IRA into a Roth IRA. I ended up not doing it right away after realizing that I might hit the ceiling that limits conversions to those with a modified adjusted gross income (MAGI) of $100,000 or less. The same ceiling applies for both a single person and a married couple’s combined income! And if you go the married filing separately route, you can’t convert your IRA at all. I never understand these marriage penalties.
Of course, then I quit my job in July so I should have just gone ahead and converted it. But then I thought, maybe we might even end up in the 15% tax bracket for 2006! That would really save on taxes. But it doesn’t look like it (which is a good thing of course.) So we’ll most likely convert this year. Some additional things I want to take into account are:
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