Tax Planning for Retirement
Beaumont TX
Most retirees pay far more in taxes than they need to — not because of bad luck, but because no one planned the withdrawal sequence, the Roth conversion window, or the RMD impact before it was too late. Richard Placette II helps Southeast Texas retirees build a tax-efficient income plan that reduces lifetime taxes and keeps more money in their hands.
Who This Is For
What a Tax Planning Review Covers
What the Process Looks Like
Income Inventory
We map all your income sources — Social Security, pension, IRA/401(k) balances, taxable accounts — and project your income in retirement year by year.
Tax Bracket Projection
We project your federal tax bracket each year from now through age 90, including the impact of RMDs, Social Security, and any pension income.
Roth Conversion Analysis
We identify the years — typically between retirement and age 73 — where your tax bracket is lowest and Roth conversions make the most sense.
Withdrawal Sequencing
We build a year-by-year withdrawal plan that draws from the right accounts in the right order to minimize your lifetime tax bill.
Social Security Coordination
We model the interaction between your Social Security claiming age, IRA withdrawals, and the taxable portion of your benefit.
Annual Review
Tax laws change. Your situation changes. We review your tax plan annually and adjust as needed.
Common Retirement Tax Mistakes
Missing the Roth conversion window
The years between retirement and age 73 are often the lowest-tax years of your life. Not converting traditional IRA assets to Roth during this window means paying higher taxes on forced RMDs later.
Withdrawing from Roth accounts first
Roth accounts grow tax-free and have no RMDs. Drawing them down early wastes decades of tax-free compounding. They should generally be the last accounts you touch.
Ignoring IRMAA
Medicare Part B and D premiums increase significantly above certain income thresholds (IRMAA). A large Roth conversion or IRA withdrawal in a single year can trigger surcharges of $1,000–$5,000+ per person. Planning conversions to stay below IRMAA thresholds avoids this.
Not coordinating with a CPA
Tax planning for retirement requires coordination between your financial plan and your tax return. We work alongside your CPA to ensure the strategy we build is implemented correctly at tax time.
Frequently Asked Questions
Why does tax planning matter more in retirement than during working years?
During your working years, your tax situation is relatively predictable — you earn income, you pay taxes. In retirement, you control when and how much you withdraw from different account types, which gives you significant flexibility to manage your tax bracket. But that flexibility disappears if you do not plan for it. Required Minimum Distributions starting at age 73 can force large taxable withdrawals that push you into higher brackets, trigger Medicare surcharges, and make more of your Social Security taxable. Proactive planning in the years before RMDs begin can save tens of thousands of dollars.
What is a Roth conversion and why would I do one in retirement?
A Roth conversion moves money from a traditional IRA (taxable on withdrawal) to a Roth IRA (tax-free on withdrawal). You pay income tax on the converted amount in the year of conversion. The strategy makes sense when you are in a lower tax bracket than you expect to be in the future — typically in the years between retirement and when Social Security and RMDs begin. Converting strategically over several years can reduce your lifetime tax bill significantly.
What is the "tax torpedo" and how do I avoid it?
The tax torpedo is a phenomenon where large IRA withdrawals in retirement push your combined income above the threshold where 85% of Social Security becomes taxable — effectively creating a hidden marginal tax rate spike. For some retirees, an additional dollar of IRA income triggers $0.85 of additional taxable Social Security, creating an effective marginal rate much higher than their stated bracket. Managing IRA withdrawals and Roth conversions to stay below this threshold is one of the highest-value tax planning strategies available.
What is the optimal account withdrawal order in retirement?
The conventional wisdom is to withdraw from taxable accounts first, then tax-deferred accounts (traditional IRA, 401k), then Roth accounts last. But the optimal order depends on your specific tax situation. In some cases, drawing down traditional IRA assets before RMDs begin — even if you do not need the income — reduces future RMDs and the associated tax burden. We model your specific situation to determine the withdrawal sequence that minimizes lifetime taxes.
How do Required Minimum Distributions affect my tax plan?
RMDs begin at age 73 and require you to withdraw a minimum amount from traditional IRAs and 401(k)s each year, based on your account balance and life expectancy. These withdrawals are fully taxable as ordinary income. For retirees with large traditional IRA balances, RMDs can push them into higher tax brackets, trigger IRMAA Medicare surcharges, and increase the taxable portion of Social Security. Reducing traditional IRA balances through strategic Roth conversions before age 73 is the primary tool for managing this problem.
Does Texas have a state income tax on retirement income?
No. Texas has no state income tax, which means Social Security, pension income, IRA withdrawals, and investment income are not taxed at the state level. This is a significant advantage for Texas retirees compared to states like California or New York. Federal income taxes still apply, which is why federal tax planning remains important.
Start Reducing Your Retirement Tax Bill
Schedule a free consultation and we will review your current accounts, project your future tax brackets, and identify the highest-value opportunities to reduce your lifetime taxes — before the Roth conversion window closes.
Services Available in This Area
Serving Communities Across Southeast Texas
Looking for a Financial Advisor Near You in Southeast Texas?
If you are searching for a financial advisor near Beaumont, Lumberton, Port Arthur, Orange, Nederland, Vidor, Silsbee, Jasper, or the surrounding Southeast Texas area, Richard Placette II with MRB Capital Group provides retirement planning, investment management, 401(k) rollover guidance, Social Security planning, and portfolio risk analysis for individuals, families, retirees, plant workers, and business owners. Whether you are preparing for retirement, reviewing an old 401(k), evaluating investment risk, or looking for a second opinion on your current portfolio, the first step can be a simple 3–5 minute Risk Assessment designed to help identify your personal Risk Number.