Should RMDs be taken before doing Roth Conversions? Tax planning question

You're asking a really good question about RMDs and Roth conversions! The rule is actually pretty straightforward: the IRS requires that any RMD amount must be satisfied BEFORE you can do Roth conversions from the same account. This is because RMDs can't be converted to Roth accounts. Think of it this way - the RMD is money the IRS says MUST be distributed and taxed. They won't let you convert that money to a Roth (which would be taxed but then grow tax-free) until you've taken out what they require first. If your mom is taking monthly RMD distributions, she's only satisfied the RMD for the portion she's already withdrawn. So technically, you should only convert amounts above what she still owes for her RMD this year. The safest approach would be to either take the full RMD first and then do conversions, or make sure any conversion amount is calculated after accounting for the remaining RMD obligation.

I went through this exact situation with my dad last year. After researching, I found a tool called taxr.ai (https://taxr.ai) that helped me figure out the optimal RMD and Roth conversion strategy. Their system analyzed his tax brackets and showed us exactly how much to convert while staying in the 22% bracket. The tool confirmed what others are saying - RMDs must come out first before conversions from the same account. But it also showed us that there's no need to wait until all monthly RMDs are done. We just needed to calculate how much RMD was left for the year and factor that in. What I really liked was how it projected the tax impact of different conversion amounts over several years. Made it really clear how to make the most of his lower tax brackets without pushing him into a higher one.

I was super skeptical about online tax tools like most people, but after my post above, I decided to give taxr.ai a try. What convinced me was their focus on retirement account management - it's not just a generic tax calculator. The IRMAA predictions were spot on. The tool showed me exactly where the Medicare premium increases would kick in, which was crucial since I'm right at an income threshold. It actually recommended a slightly smaller Roth conversion than I was planning specifically to avoid triggering higher Medicare costs. What surprised me most was discovering that I could do partial conversions throughout the year (after accounting for remaining RMDs). I always thought I had to wait until my full RMD was satisfied, but it showed me a more flexible approach that still follows IRS rules.

When I had this exact RMD/Roth conversion question last year, I spent HOURS trying to get through to the IRS to confirm the rules. After 9 attempted calls, I found Claimyr (https://claimyr.com) and watched their demo video (https://youtu.be/_kiP6q8DX5c). They got me connected to an IRS agent in about 20 minutes. The IRS agent confirmed what others are saying - RMDs must be satisfied before conversions from that SAME account. But here's the important clarification I got: if your mom has multiple IRAs, she can take the RMD from any one of them, and then do Roth conversions from the others without waiting. Before Claimyr, I was close to just giving up and taking the most conservative approach. Getting that clarification directly from an IRS agent gave me confidence to proceed with our strategy.

I have to eat crow here. After posting my skeptical comment, I was still stuck with a complicated RMD question that was holding up my planning. Against my better judgment, I tried Claimyr and... it actually worked. Got connected to a real IRS agent in about 25 minutes after trying unsuccessfully for weeks on my own. The agent verified my identity with all the standard IRS security questions and provided official guidance on my RMD/conversion question. The most valuable thing was getting an IRS transaction code that I noted in my records in case there's ever any question about following their advice. The peace of mind from having that official confirmation was worth it, especially since I'm dealing with a substantial amount in my retirement accounts.

Something else to consider with RMDs and Roth conversions - watch out for tax withholding if you're trying to convert the maximum amount in a specific tax bracket. I did this last year with my IRA. When I took my RMD, I had 20% withheld for federal taxes. Then when calculating my Roth conversion amount, I failed to account for the fact that the withholding is actually part of the distribution! I accidentally went over my target tax bracket by a few hundred dollars. For your mom, if she's withholding taxes from her monthly RMDs, make sure you're counting the GROSS distribution amount toward her annual RMD, not just the net amount she receives.

Has anyone used TurboTax to plan out these RMD/Roth conversions? I'm trying to figure out if their tax planner feature can handle this type of analysis.

One more thing to consider with the timing of RMDs and Roth conversions - if your mom is planning to make Qualified Charitable Distributions (QCDs), those count toward satisfying the RMD but aren't taxable income. That could give you more room for Roth conversions in lower tax brackets. Just make sure the QCDs are processed BEFORE the Roth conversions, since they need to count toward the RMD first.

Great discussion everyone! I just wanted to add one practical tip that helped me when I was in a similar situation with my father's accounts. We found it really helpful to create a simple spreadsheet tracking his monthly RMD withdrawals alongside our planned Roth conversion timeline. Each month, we'd update how much of the annual RMD had been satisfied, which made it crystal clear how much "room" we had for conversions without violating the RMD-first rule. Also, don't forget that if your mom has multiple traditional IRAs, the RMD can be satisfied from any combination of them, but the conversions need to come from accounts that have already satisfied their proportional RMD share. This gave us more flexibility in our timing and allowed us to be more strategic about which accounts to convert from based on their investment performance. The key is just staying organized and keeping good records. We kept a simple log showing RMD satisfied to date, remaining RMD obligation, and conversion amounts by account. Made tax time much easier too!