Tax Savings from Converting a Regular IRA to a Roth IRA

This spreadsheet compares the taxes due
upon converting a regular IRA to a Roth IRA to the present value of total
taxes saved in retirement on the distribution from a regular IRA.If the net present value of taxes saved is
positive, it may be advantageous for you to convert.If the net present value of taxes saved is
negative, it may not be advantageous for you to convert.Please consult with your tax advisor to
determine if you should convert your traditional IRA to a Roth IRA.

Input Variables:

Current Age

Assumed Investment Return

Current Marginal Tax Rate (Federal and State)

Effective Tax Rate in Retirement (Federal and State) on Retirement Plan
Distributions

Regular IRA Account Value

Cumulative After-Tax Contributions

Results:

A. Taxes Due Upon Conversion:

Amount of Gain at Conversion

Taxes Due Upon Conversion

B. Present Value of Total Taxes Saved:

Fair Market Value of Regular
IRA Account at the Age of 70

Total Amount of Distributions
(Begin at age 70 and go for 30 years)

Annual Distribution Amount

Less:Basis

Taxable Gain per Year

Taxes Saved per Year in
Retirement

Total Amount of Taxes Saved in
Retirement

Present Value of Total Taxes
Saved in Retirement at the age of 70

Present Value of Total Taxes
Saved in Retirement at your current age

C. Net Present Value of Taxes Saved:

Present Value of Total Taxes
Saved in Retirement at your current age

Less: Taxes Due Upon
Conversion

Net Present Value of Taxes
Saved (If positive - Convert, If Negative - Do not)

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