PFP2618. Biggest Tax Planning Mistakes People Make In Retirement (And How to Avoid Them)

There is a wide array of federal and state-specific tax planning opportunities available to individuals in retirement. While some opportunities might be for the current tax year, others are longer-term in nature.

Additionally, tax planning goals can vary by client, where some want to minimize taxes for themselves, while others might want to minimize taxes for their eventual beneficiaries via tax-efficient wealth transfer.

There are no universal tax planning opportunities that apply to all individuals in retirement. But there are nonetheless opportunities that are common among many retired individuals. This session will discuss the common retirement tax planning opportunities for individuals, the mistakes people often make regarding those opportunities, how to avoid those mistakes, and how to correct them (if possible).

The session will focus on the following retirement tax planning opportunities, and common mistakes around them:

• Underpayment penalties & interest
• Required Minimum Distributions (“RMDs”)
• Beneficiary designations
• Roth withdrawal rules
• IRA non-deductible “basis” and the pro rata rule on distributions and conversions
• Charitable giving
• Managing MAGI for purposes of Affordable Care Act Premium Tax Credits and/or Medicare Income Related Monthly Adjustment Amount (“IRMAA”) surcharges
• State-specific income tax and planning considerations

Learning Objectives:

• Develop awareness of the major federal and state-level tax planning opportunities often available to individuals in retirement, and the common mistakes made around those opportunities
• Obtain knowledge in avoiding the common retirement tax planning mistakes, as well as knowledge in rectifying the mistakes