Free course · Retirement · Intermediate
Tax Landmines After the Last Paycheck: Retirement Tax Planning
A free intermediate retirement tax planning course for savers with large traditional IRA or 401(k) balances, covering the tax years that cost the most and the earlier years when you can still get ahead of them.
- Lessons
- 4
- Time
- About 54 minutes
- Level
- Intermediate
- Cost
- Free, no sign-up
Who it is for
Retirees and near-retirees with savings in a traditional IRA or 401(k) who want to see how withdrawals, benefits and Medicare premiums interact.
By the end you can
- Spot the income range where each extra dollar makes more Social Security taxable
- Estimate a required minimum distribution and the tax it adds
- Anticipate a Medicare IRMAA surcharge from income two years earlier
- Plan withdrawals or conversions that fill low brackets before RMDs start
Lessons
- 01 The Social Security Tax Torpedo: When Your Marginal Rate Jumps
The Social Security tax torpedo explained: why an extra $1,000 IRA withdrawal can be taxed at 22.2% or 40.7%, who meets it, and ways to plan around it.
- 02 Required Minimum Distributions: Ages, Tables and the 25% Penalty
Required minimum distributions explained: the starting age under SECURE 2.0, the Uniform Lifetime Table sum, the 25% penalty and the QCD and still-working outs.
- 03 Medicare IRMAA Surcharges: The Income Cliff Two Years Back
Medicare IRMAA surcharges explained: how income from two years back sets your Part B and Part D premiums, the one-dollar cliff, and when to file Form SSA-44.
- 04 Filling Low Tax Brackets Before RMDs: Roth Conversions in Gap Years
Filling low tax brackets before RMDs: how Roth conversions in the gap years between retiring and RMDs work, a worked 12% bracket sum, and what to watch first.
Take a hypothetical $10,000 more from an IRA in the wrong year and your taxable income can rise by as much as $18,500. Each extra dollar of income can also pull up to 85 cents of Social Security benefits into tax, so the IRA money gets taxed and drags part of your benefit along with it.
That is one trap. There are others, and they tend to arrive together.
Who it suits
It suits retirees and people close to retiring who have most of their savings in pre-tax accounts: a traditional IRA, a 401(k), a 403(b). Those balances have never been taxed. Every dollar will be, eventually, and the timing of those dollars decides how much Social Security is taxed, whether Medicare premiums jump and which bracket your required withdrawals land in once they start, which can be higher than the one you paid while working.
Mostly in Roth accounts already? Less of this applies. Savers in their late 50s and early 60s have the most room to act, because the cheapest years for drawing down pre-tax money usually fall between the last paycheck and the first required withdrawal, and those years cannot be recovered once they pass.
What to have ready
You need last year’s tax return and a current balance for every account.
The return shows your taxable income, where it sits in the brackets, and whether any Social Security was taxed. The balances show how large your pre-tax savings are. That figure drives required minimum distributions later. Starting Medicare within two years? Bring the return from two years back too. Medicare sets the surcharge from it.
How to work through it
Go in order. Each trap sets up the next. The course begins with how Social Security becomes taxable, moves to the required withdrawals that start in your 70s under SECURE 2.0, then to the Medicare premium surcharge that looks back at income from two years earlier. It ends with the planning move that addresses them all at once: using the low-income years before RMDs begin to draw down pre-tax money on your own terms.
Work every example on paper. Then redo it with the figures from your own return.
Yearly thresholds appear only as labeled hypotheticals. Check the current figures at IRS.gov and Medicare.gov before acting on any of them.
What it leaves out
State income taxes are not covered, and neither are estate or gift taxes. Either can change the right answer.
The course explains the rules and the arithmetic, and the decision stays yours. Situations differ, and a tax professional who sees your whole return should check any large withdrawal or conversion before you make it.
Where to go after
Conversions are the main tool for filling low brackets, and the lesson on Roth conversions and the backdoor Roth covers how they are taxed. The full Roth and HSA course sets out the tax-free side of the ledger. For the benefit side, the guide to how Social Security is taxed works through the provisional income test in detail.
Questions traders ask next
Why is the course marked intermediate?
It assumes you already know what a traditional IRA and a Roth are and can find taxable income on a Form 1040. The lessons build on that to show how several rules stack in one tax year. If those basics are new, start with the Roth and HSA course first.
Does the course use real tax brackets and IRMAA thresholds?
No. Brackets and Medicare surcharge thresholds change every year, so the lessons use round hypothetical figures, clearly labeled. The IRS publishes new brackets each fall, and the income tiers for Medicare surcharges appear each year on Medicare.gov and in SSA notices.