In this article
A tax return records what already happened. In retirement, the choices that set your tax bill, such as Roth conversions, required distributions, Social Security, Medicare premiums, and how you give, are made during the year. Planning before the return is due is how you get a say in what you owe, now and later.
Why April is too late
A return can’t change when you took income, which account it came from, or whether you converted, gave, or sold. Those decisions are made during the year, and in retirement you have more of them than ever.
That’s why we give proactive advice throughout the year, based on your income, expenses, needs, and goals. We monitor tax law changes that could affect you, recommend strategies as they make sense, and serve as your advocate in tax matters. The goal is to keep your tax bill in check year after year without giving up the standard of living you planned for.
Five decisions that shape your tax bill in retirement
1. Whether to convert to a Roth
Converting traditional IRA money to a Roth IRA means paying income tax on the converted amount in the year you convert. In exchange, a Roth IRA has no required minimum distributions during your lifetime, and qualified withdrawals come out tax-free. Each conversion also starts its own five-year period for penalty-free withdrawal of the converted amount before age 59½.
2. When required distributions begin
Required minimum distributions from a traditional IRA begin for the year you turn 73. Once they start, they add to your taxable income every year, so the years before they begin can be a useful window for planning.
3. How much of your Social Security is taxed
Depending on your other income, up to 85% of your Social Security benefits can be taxable on your federal return. Florida has no state income tax, so here it’s the federal bill that matters. Which accounts you draw from, and when, can change how much of your benefit is taxed.
4. What you’ll pay for Medicare
Higher incomes pay more for Medicare Part B and Part D. The added amount is based on the income on your federal tax return, usually from two years earlier, so a large conversion or sale this year can show up in your premiums later.
5. How you give
If you’re 70½ or older and give to charity, a qualified charitable distribution sends money from your IRA directly to the charity. It isn’t counted as taxable income, and once you reach RMD age it can count toward your required distribution for the year.
What each of our tax reviews covers
Tax planning here is a defined set of services, not a once-a-year conversation. Three of them are reports you receive and keep.
Roth Conversion Analysis
- What it covers
- What converting would cost you now against what leaving it alone could cost later: your current bracket, your projected bracket at RMD age, the amount modeled, the tax due this year, and the break-even year.
1040 Tax Optimization Report
- What it covers
- Reads your return the way a planner does, looking for what the filing season missed: income sources, deductions, credits, and items flagged.
Personalized Tax Reduction Report
- What it covers
- The strategies that apply to your situation, in the order they should be taken.
2nd Opinion Prior Year Review
- What it covers
- Looks at a return you have already filed to see whether anything was missed.
Individual and Business Tax Return Reviews
- What it covers
- Reviews of individual and business returns.
Our five tax planning services. What goes into each report depends entirely on your own situation.
A year-round rhythm
Tax planning works best on a schedule. We meet face to face every quarter for reviews and tax planning sessions, so strategies can be put in place while there’s still time in the year to use them.
How tax planning fits your plan
In our 8 Elements, tax planning draws on Income Optimization, the Legacy Enhancer, the Dynasty Creator, and the Tax Planner. Taxes cost your investments in the short term and the long term, so the Tax Planner traces how they touch everything: your income, your assets, your estate, and your legacy. Before we recommend a change here, we check how it affects the rest of your plan, including what your heirs will owe.
Key takeaway
Your tax bill in retirement is shaped by decisions made during the year: Roth conversions, when required distributions begin, how Social Security is taxed, what Medicare costs, and how you give. Planning before the return is due keeps more of what you’ve built with you and your family.
Sources
- IRS Publication 590-A, Contributions to Individual Retirement Arrangements
- IRS Publication 590-B, Distributions from Individual Retirement Arrangements
- IRS, Retirement plan and IRA required minimum distributions FAQs
- IRS Publication 915, Social Security and Equivalent Railroad Retirement Benefits
- Social Security Administration, Medicare premiums: rules for higher-income beneficiaries
- IRS, Seniors can reduce their tax burden by donating to charity through their IRA
Sources reviewed October 29, 2026. Rules can change. This article is educational and is not personalized tax, legal, or financial advice.
The Terrio Group does not provide tax or legal advice. Consult your tax professional regarding your specific situation.
Frequently asked questions
- Is a Roth conversion right for me?
- It depends on your current and future tax brackets, your time horizon, and your legacy goals. A Roth Conversion Analysis looks at your numbers before anyone recommends a move.
- Can a Roth conversion raise my Medicare premiums?
- It can. Medicare’s income-based premium adjustment uses the income on your tax return, usually from two years earlier, so a conversion can show up in your Part B and Part D premiums later.
- Can you review a return I already filed?
- Yes. A 2nd Opinion Prior Year Review looks at a return you have already filed to see whether anything was missed.
- Does tax planning affect my heirs?
- It can. Tax planning shapes how much of your wealth transfers and how much is lost along the way, which is why we plan it alongside your estate.
Talk it through
Want a second set of eyes on your situation?
Your first meeting is complimentary. You don’t bring statements or do any homework. We spend the time getting to know you, and you decide whether we’re a fit.