Re: Odds question
[ QUOTE ]
Lets assume that you have a regular IRA & a Roth IRA. Lets also assume that you are in the 35% tax bracket and that there are 15 years to go before you start withdrawls. What % chance do you have to believe that Greenspan (or whoever proceeds him) will institue a 10% federal sales tax and reduces the income tax by the same 10% before it is unprofitable to make the transfer from IRA to Roth?
[/ QUOTE ]
Greenspan (and his "successor") is the Charman of the FOMC and does not set tax rates.
If you are currently in a 35% marginal tax bracket, your income may be too high to contribute to a Roth IRA.
Assuming you are eligible for conversion - If you expect income tax rates to decline you are probably supposed to wait until the decline takes affect before you convert (assuming you believe the tax rate increase will take affect sooner rather than later).
I don't think the prevailing sales tax rate matters. (Except for the fact that raisng the sales tax is potentially one way to justify lowering the income tax rate.)
I don't know how you you will assign odds to the various scenarios, but assuming you can - you will need a CPA.
|