In this episode, Dan and Ed review key year-end tax planning considerations for federal employees and retirees, with a focus on Roth IRA conversions in light of recent tax law changes. They discuss potential tax implications, Medicare premium impacts, and new options available in 2026 for TSP participants.
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FedLife Podcast | Ep. 160: Roth IRA Conversions in 2025 – What Federal Employees Should Consider
Join us as Dan and Ed walk through six important considerations federal employees and retirees should review before converting a traditional IRA to a Roth IRA.
In this episode, you’ll learn:
- How the extension of current federal tax brackets may impact Roth conversion decisions
- How a Roth IRA conversion can increase adjusted gross income (AGI) and affect tax brackets, credits, deductions, and potential “stealth taxes”
- The potential impact of higher income on Medicare Part B and Part D premiums, including IRMAA considerations
- Estimated tax payment rules and how late-year conversions may create underpayment risks
- Situations where a Roth IRA conversion may not be appropriate, including charitable beneficiary planning and five-year rules
- The new option beginning January 1, 2026 allowing traditional TSP to Roth TSP conversions
- Key differences between converting through an IRA versus converting within the TSP
Source Article: https://stwserve.com/with-the-passage-of-obbba-are-roth-ira-conversions-still-recommended-for-federal-employees-and-retirees/
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