Retire With Style

Episode 216: The Retirement Tax Mistake That Costs Thousands

Feb 17, 2026
They dig into retirement tax planning topics like Roth conversions, required minimum distribution traps, and effective marginal tax rates. The conversation covers income tracking, harvesting long-term capital gains at 0%, IRMAA and Medicare surcharge quirks, and using tools like tax maps. They also explore strategies such as QLACs and reverse mortgages for managing future tax liabilities.
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ADVICE

Harvest Gains Up To Your 0% Capacity

  • Calculate 0% long-term capital gains capacity by adding your applicable deduction to the $98,900 cutoff and subtracting ordinary income.
  • Watch for Social Security provisional income interactions that can reduce 0% capacity.
INSIGHT

Gains Harvesting Raises Future Cost Basis

  • Gains harvesting raises taxable account cost basis and can lower future tax when you sell for spending.
  • It may be unnecessary if assets receive a step-up in basis at death or remain in low brackets.
INSIGHT

Tax Cliffs Create Planning Headaches

  • The U.S. tax code has accumulated cliffs and torpedoes that complicate retirement planning.
  • Simplifying marginal taxation would reduce planning complexity and odd cliff effects.
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