Quick question

[Pacun]

If a client decides to pay all taxes on the Roth Conversion, he will use his tax bracket for 2010.

If client decides to split paying taxes between 2011 and 2012, we are going to use those tax brackets, correct?

So, if a client asks me "what do you think is better for me"?, you pull out your crystal ball and tell them.

[Philip1117]

You tell them they exchanged paying taxes with worthless inflated money in the future with real dollars today. If they had that much extra cash laying around they should have exchanged the paper for hard goods instead of more paper.

Phil

[Pacun]

Am I correct stating that I don't know if splitting the payment is better than one 2010 payment?

[Gail in Virginia]

Yes, you are. There are so many variables involved - what will tax rates be? what will be deductible? what will their income be? All of these things affect how much this will cost them in the future. You can tell them what their taxes will be this year if they don't split it. You can even use the planner to make an educated guess, assuming that there are no major tax changes in the next two years and no major changes in their situation, about what it will cost them over two years. But unless you have a better crystal ball than I do, you can't be sure that your assumptions are correct and therefore you can't be sure that the projected taxes are correct. Take your best guess, client. :dunno: