THE NEW HOLISTIC RETIREMENT • 65 potential, when their own tax brackets might be the highest. Either way, it can mean a big tax bill for my heirs. • For this analysis, I’ve assumed all taxes on my remaining IR A account bala nce ar e paid when I pass away at age ninety. If my heirs continue to hold the m in the tax- deferred account going forwa rd, t he situat ion is even w orse tha n t he following analysis, as the additional investment ea rnings w oul d a l so be t ax ed. Here’ s wh at my analysis showed for my $700,000 IRA: RMD Analysis on Martin’s Qualified Accounts (wit h reinvested RM Ds). IRA Value: $700,000
Assumed Tax Liability: 25% Pre-Tax Growth Rate: 5% Receive RMDs from Age 72 to Age 90, Per IRS Rules
Total Taxes Paid on RMDs
$230,390 $101,886
Taxes Paid on Growth of Reinvested RMDs
$160,589
Taxes Paid by Heirs on Remaining IRA Value at Death (Age 90)
TOTAL TAXES PAID
$492,865
Example shown for illustrative purposes only and is not guaranteed. Actual results may vary. That ’s a t otal of $ 492 , 000 on my $700,000 IRA!
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