Go to Jeff Salisbury LWGate Home Page.From: Ira Krakow <ikrakow_1999@yahoo.com>
Subject: Take distributions from IRA or from taxable accounts at retirement?
Date: Mon, 27 Dec 1999 20:28:47 -0500
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I saw an interesting article in the Motley Fool retirement bulletin = board, at: http://www.fool.com/retirement/retireeport/1999/retireeport991227.htm The author suggests that when withdrawing funds where there is a mixture = of IRAs and taxable accounts, it might not be too bad an idea to = withdraw from the IRAs first. From the perspective of tax efficiency = for the *entire* family (including the heirs), the heirs owe taxes on = any part of an inherited IRA (at *their* marginal tax rate) on which = taxes haven't been paid, so drawing down the IRA will have a positive = benefit to heirs by reducing their tax burden. =20 On the other hand, the retiree owes more taxes by using this strategy, = since taxes have already been paid on the taxable accounts. The article = contains a number of scenarios and charts (variables such as the = marginal tax rate of the heirs, and percentage of assets to be withdrawn = among these accounts are taken into account). =20 Where's the balance between the retiree paying less tax and the heirs = paying less tax? What considerations should be given? Ira __________________________________________________ Do You Yahoo!? Talk to your friends online with Yahoo! Messenger. http://messenger.yahoo.com - -
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