Sample Client — Retirement Tax Strategy
35-year projection starting 2026. Filing MFJ, resident of New Jersey. Federal ordinary and preferential brackets, provisional-income Social Security, two-year IRMAA lookback, and full state income tax are modeled every year.
Strategy comparison
After-tax ending value against the lifetime cost of getting there. Traditional IRA balances are discounted for embedded income tax so strategies are compared on a like-for-like basis.
| Strategy | Converted | Federal tax | State tax | IRMAA | Peak RMD | After-tax ending | vs baseline |
|---|---|---|---|---|---|---|---|
| Baseline / Taxable First | $0 | $3.22M | $478K | $285K | $362K | $15.8M | — |
| Fill 12% Bracket | $213K | $3.07M | $443K | $282K | $332K | $16.6M | +$781K |
| Fill 22% BracketSelected | $1.12M | $2.64M | $341K | $321K | $224K | $19.0M | +$3.12M |
| Fill 24% Bracket | $2.83M | $2.04M | $214K | $272K | $23K | $23.2M | +$7.33M |
| IRMAA-Aware Hybrid | $437K | $2.94M | $413K | $278K | $305K | $17.3M | +$1.46M |
| IRA First / RMD Smoothing | $0 | $2.96M | $415K | $288K | $308K | $15.2M | -$599K |
| Custom (Your Inputs) | $437K | $2.94M | $413K | $278K | $305K | $17.3M | +$1.46M |
Story in brief. Fill 24% Bracket produces the highest after-tax ending value at $23,179,902 — +$7.33M versus the baseline. Fill 24% Bracket carries the lowest lifetime tax and IRMAA cost at $2,526,223. When those differ, the higher-tax path is buying a larger tax-free Roth balance; weigh that against cash-flow needs and the survivor bracket.
Portfolio composition over time
Fill 22% Bracket — account balances at each year end.
Annual tax and surcharge stack
Federal ordinary tax, preferential-rate tax plus NIIT, state income tax, and Medicare IRMAA — with the federal marginal rate overlaid.
RMD pressure vs Roth conversions
Conversions in the pre-RMD window trade current income for lower required distributions later.
MAGI against IRMAA thresholds
Medicare surcharges use a two-year MAGI lookback. Crossing a line by one dollar costs a full tier for both spouses.
This is an advisor planning aid, not a tax return engine. Bracket, deduction, IRMAA, and state figures are 2026 planning placeholders that must be verified annually. Use firm-approved planning software for final suitability and client-ready recommendations.