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 | $3.11M | $456K | $300K | $334K | $15.7M | — |
| Fill 12% Bracket | $213K | $2.97M | $422K | $293K | $307K | $16.5M | +$791K |
| Fill 22% BracketSelected | $1.03M | $2.62M | $333K | $327K | $215K | $18.7M | +$2.99M |
| Fill 24% Bracket | $2.81M | $2.04M | $213K | $275K | $22K | $23.1M | +$7.42M |
| IRMAA-Aware Hybrid | $438K | $2.86M | $394K | $287K | $282K | $17.2M | +$1.48M |
| IRA First / RMD Smoothing | $0 | $2.89M | $402K | $295K | $289K | $15.1M | -$563K |
| Custom (Your Inputs) | $427K | $2.86M | $394K | $290K | $283K | $17.2M | +$1.45M |
Story in brief. Fill 24% Bracket produces the highest after-tax ending value at $23,121,788 — +$7.42M versus the baseline. Fill 24% Bracket carries the lowest lifetime tax and IRMAA cost at $2,525,543. 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.