[Stu from NYC]

Originally Posted by retiredguy123

I find this example to be simple but interesting. Assume a tax rate of 30 percent, and an investment return of 10 percent. Convert $1,000 of your IRA to a Roth and pay $300 in tax. One year later, you will have $770 in the Roth. But, instead of converting, suppose you keep the $1,000 in the traditional IRA and withdraw it a year later. You will pay $330 in tax ($1,100 × 0.3) and you will have $770, the exact same amount as if you had converted it to a Roth.

Two points:
1. You are assuming that tax rates will be higher in the future, but they may not be.
2. If you ever need long term health care, assisted living, or a nursing home, you can use the traditional IRA money to pay for the care and take a huge medical tax deduction. In the case of a nursing home, 100 percent of the cost is tax deductible. With assisted living, you can deduct a percentage of the cost, which could be about 60 percent.

I agree. Paying taxes now removes the growth from those funds. Who is to say the govt might decide to tax ROTH funds down the road.

Who would have thought we would be paying taxes on our SS income.