Many new retirees live off savings from age 62 and wait until 70 to claim Social Security, filing with very little taxable income even though these years offer the lowest tax brackets they will see. For a married couple filing jointly in 2026, income taxed at 12% extends to $100,800, so a couple spending $60,000 could convert about $70,000 a year to a Roth, moving $560,000 over eight years and saving $56,000 compared with paying 22% later. Waiting until 70 can backfire, as Social Security plus required minimum distributions can make up to 85% of benefits taxable, pushing a 22%-bracket couple's effective marginal rate to 40.7%. Converting before 65 can also cost ACA premium subsidies, Medicare premiums are based on income from two years earlier, and taxes withheld from a conversion never reach the Roth.
Summary written by Upside AI from the original article. Read the source for full details.
Original headline: The Eight Years Between Retiring at 62 and Claiming Social Security at 70 Are the Lowest Tax Bracket Most Retirees Will Ever See . A Couple Spending $60 , 000 Can Convert About $70 , 000 a Year to a Roth at 12 % and Never Pay 22 % on It Again
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