Should I Convert Company Stock in My 401(k) to Roth or Consider NUA First?

You’re 62 and retiring after 30 years with the same company.

Your 401(k) is worth $1.8 million.

Your first thought is pretty simple:

“I’ll roll the whole thing into an IRA and then figure out how much to convert to Roth.”

That may sound completely reasonable.

But there’s a detail hiding inside the account.

$500,000 of your 401(k) is company stock.

And the plan’s cost basis in those shares is only $120,000.

Now this isn’t just a rollover decision.

Before moving those shares, you may need to answer a completely different question:

“Could this company stock qualify for Net Unrealized Appreciation treatment, and what would I give up if I simply rolled it into an IRA?”

That’s where Roth conversion planning and NUA planning can collide.

What Is Net Unrealized Appreciation?

Net Unrealized Appreciation is usually shortened to NUA.

In simple terms, it refers to appreciation in qualifying employer securities held inside an employer retirement plan.

Imagine your 401(k) purchased company stock over the years for a total plan cost basis of $100,000.

Today those shares are worth $400,000.

The difference between the plan’s cost basis and current market value is $300,000.

That’s the basic NUA we’re talking about.

Why Does NUA Matter?

Because special federal tax treatment may apply when qualifying employer securities are distributed from an employer plan under the applicable NUA rules.

Under a qualifying NUA transaction, the plan’s cost basis in the employer securities is generally included in taxable income when distributed.

The qualifying NUA portion generally isn’t taxed as ordinary income at that point.

When the stock is later sold, the qualifying NUA portion can generally receive long-term capital gain treatment under current federal rules.

Additional appreciation after distribution can have its own tax treatment based on the circumstances.

That’s very different from simply treating the entire appreciated stock position like ordinary traditional retirement money.

Why Could a Routine IRA Rollover Be a Problem?

Because once you move employer stock into an IRA, you generally don’t get to recreate an NUA transaction later using those IRA-held shares.

That’s why the analysis belongs before the rollover.

Not six months afterward.

Not when you file the tax return.

Before the shares move.

The Sentence That Can Cause the Problem

It sounds harmless:

“Just roll the whole 401(k) into an IRA.”

For many retirees, an IRA rollover may be perfectly reasonable.

But if the plan contains highly appreciated employer stock, “the whole 401(k)” deserves another look.

Those company shares may need to be analyzed separately from the mutual funds, bond funds, cash, target-date funds, or other investments inside the plan.

Example: $500,000 of Company Stock

Suppose your 401(k) looks like this:

• $1.3 million of diversified investments
• $500,000 of employer stock
• $1.8 million total account value

The employer stock has a plan cost basis of $120,000.

That means the stock contains approximately:

• $120,000 of plan cost basis
• $380,000 of unrealized appreciation

Now compare two broad paths.

Path #1: Roll Everything Into an IRA

You roll the entire $1.8 million into a traditional IRA through an otherwise appropriate rollover.

Now you have one large traditional IRA.

You begin evaluating Roth conversions.

Simple.

But the company stock is now sitting inside the IRA along with everything else.

The potential NUA treatment that may have been available through an eligible employer-plan distribution needs to have been considered before that move.

Path #2: Evaluate NUA Before Moving the Stock

Instead, you stop before rolling the account.

You have qualified tax and financial professionals evaluate whether the company shares meet the requirements for NUA treatment and whether using it actually makes financial sense.

Maybe the qualifying employer stock is distributed in kind to a taxable brokerage account as part of a properly structured transaction.

Maybe other eligible plan assets are rolled to an IRA.

Then Roth conversions are evaluated on the tax-deferred assets that remain.

Now you’re not forcing every retirement dollar through the same tax strategy.

NUA and Roth Conversion Aren’t Necessarily Either-Or

This is important.

Someone may hear “NUA vs. Roth conversion” and assume they have to pick one strategy for the entire 401(k).

Not necessarily.

Maybe the company stock deserves one analysis.

Maybe the rest of the 401(k) deserves another.

You could potentially evaluate:

• NUA treatment for qualifying employer securities
• Traditional IRA rollover treatment for other eligible plan assets
• Roth conversions for selected tax-deferred assets

The actual transaction has to satisfy applicable rules.

But conceptually, different assets can have different jobs.

Why the Cost Basis Matters So Much

Consider two retirees.

Both have $500,000 of company stock inside their 401(k).

Retiree A has a plan cost basis of $450,000.

Retiree B has a plan cost basis of $75,000.

Same current stock value.

Completely different NUA picture.

Retiree A has relatively little appreciation.

Retiree B has substantial appreciation relative to basis.

You can’t evaluate NUA by looking only at the current stock value.

“I Don’t Even Know My Cost Basis”

That’s common.

You log into the 401(k) and see:

Company Stock: $487,326

Great.

But what’s the plan’s cost basis?

How many shares are there?

Were shares acquired at different times?

Does the plan administrator have the necessary records?

Before making an irreversible distribution or rollover decision, get the actual plan information.

Why Capital Gain Treatment Can Matter

Traditional retirement-account distributions are generally taxed as ordinary income to the extent taxable.

Qualifying NUA can potentially receive long-term capital gain treatment when the employer securities are later sold.

Those are different federal tax categories.

That difference can make NUA attractive in some situations.

But don’t stop there.

Capital gains can interact with other parts of the tax return.

State tax treatment can differ.

Investment concentration matters.

Future appreciation matters.

Estate planning matters.

And Roth assets have characteristics NUA stock in a taxable account doesn’t have.

Roth Has Its Own Potential Advantages

A Roth conversion takes selected tax-deferred retirement assets and moves them into Roth.

The taxable portion of the conversion is generally included in income in the conversion year.

Qualified Roth distributions are generally tax-free under current federal rules when applicable requirements are met.

The original Roth IRA owner generally has no lifetime RMDs under current federal rules.

That’s a very different tax structure from holding NUA company stock in a taxable brokerage account.

So Which One Is Better?

That’s the wrong first question.

Ask:

“Which tax treatment is more valuable for these specific dollars?”

Maybe the company stock belongs in an NUA analysis.

Maybe another $1 million of the account belongs in a Roth conversion analysis.

Maybe NUA isn’t attractive enough and the rollover strategy wins.

Make them compete.

Example: Low Basis, Large Appreciation

Suppose you have $600,000 of company stock.

The plan’s cost basis is $100,000.

There’s $500,000 of unrealized appreciation.

That deserves attention before you automatically roll those shares into an IRA.

It doesn’t prove NUA wins.

It proves the decision is large enough to model.

Example: High Basis, Small Appreciation

Now suppose the same $600,000 stock position has a $530,000 plan cost basis.

The NUA is only $70,000.

The potential tax advantage may look far less compelling after the full retirement picture is considered.

Again, don’t use a rule.

The Biggest Non-Tax Problem: Concentration Risk

There’s another issue sitting right in front of you.

You’ve worked for the company for 30 years.

Your salary came from the company.

Your bonus came from the company.

Your pension may come from the company.

And now $500,000 of your retirement savings is still invested in the company’s stock.

That’s concentration.

A potentially attractive tax treatment doesn’t automatically make a concentrated stock position a good investment decision.

“But I Know This Company”

Of course you do.

You worked there.

You know the products.

You know the executives.

You watched the stock grow.

You may think:

“I understand this company better than I understand some mutual fund.”

Maybe you do.

But familiarity doesn’t remove investment risk.

The Emotional Attachment Can Be Strong

This isn’t just stock.

It may represent 30 years of your life.

You remember when the shares were worth a fraction of today’s price.

You remember coworkers who sold too early.

You think:

“What if I sell it and the stock doubles?”

That’s not a tax question.

That’s an identity and regret question.

NUA Doesn’t Mean You Have to Hold the Stock Forever

This is another misunderstanding.

The tax strategy and the investment decision aren’t necessarily identical.

If qualifying employer stock is distributed under an NUA strategy, the eventual decision to hold or sell shares should still be evaluated based on your investment plan, diversification needs, taxes, and goals.

Don’t turn a tax strategy into a permanent emotional commitment to one company.

What If the Stock Falls After I Use NUA?

That’s real investment risk.

Suppose $500,000 of company stock is distributed.

Then the company has a terrible year and the position falls to $350,000.

A tax strategy doesn’t protect you from a falling stock price.

This is why the analysis needs to include more than the tax rate on the NUA.

What If the Stock Keeps Going Up?

That creates another tax and investment question.

Appreciation after the plan distribution isn’t necessarily treated the same way as the qualifying NUA portion.

The holding period and circumstances can affect the treatment of additional appreciation.

Your tax professional should evaluate the actual shares and transaction.

NUA Has Technical Requirements

This isn’t a strategy to execute from a blog post.

Special requirements apply.

NUA treatment can involve rules concerning employer securities, qualifying triggering events, distributions, timing, the plan balance, and how assets are distributed.

A transaction that doesn’t satisfy the applicable requirements may not receive the tax treatment you expected.

Get qualified tax guidance before moving the shares.

The Lump-Sum Distribution Rules Matter

NUA planning often involves the federal rules governing qualifying lump-sum distributions from an employer plan.

That doesn’t simply mean:

“I took a big withdrawal.”

The tax definition has specific requirements.

For example, the timing and distribution of the plan balance can matter.

Don’t assume a partial distribution you made earlier in the year is irrelevant.

Triggering Events Matter Too

Certain events can be relevant to qualifying NUA treatment.

Retirement or separation from service may be one of the events that causes someone to start evaluating the strategy.

Other qualifying events can apply under federal rules.

But the sequence of prior plan distributions can complicate the analysis.

This is another reason to review the plan history before executing anything.

Don’t Wait Until the Money Is Already in the IRA

This deserves repeating.

If you’re retiring with company stock in your 401(k), investigate NUA before automatically rolling the company shares into an IRA.

You can always decide after analysis that NUA isn’t attractive.

What you don’t want is to discover a potentially valuable option only after you’ve made a transaction that can’t simply be reversed.

What If I’ve Already Rolled Everything Into an IRA?

If the employer shares have already been rolled into an IRA, don’t assume you can move those same shares back out and recreate the original NUA opportunity.

Talk with a qualified tax professional about your actual transaction.

The point of this article is to catch the issue before the rollover.

What If I Have Company Stock From an Old Employer?

Don’t assume the age of the employment relationship answers the question.

Review:

• Where the shares are currently held
• Whether they’re employer securities
• The plan type
• The cost basis
• Prior distributions
• Your separation history
• Applicable NUA requirements

Then determine whether an NUA analysis is even available.

What If I Have Company Stock in a Brokerage Account?

That’s different.

NUA is specifically associated with qualifying employer securities held within an eligible employer retirement plan and the applicable distribution rules.

Company stock you already own in an ordinary taxable brokerage account doesn’t suddenly become NUA stock because you worked for the company.

What About RSUs and Stock Options?

Again, different issue.

RSUs, stock options, employee stock purchase plans, taxable brokerage shares, and employer stock inside a qualified retirement plan can have different tax rules.

Don’t lump every form of company equity into one category called “company stock.”

What If I’m Also Doing Roth Conversions?

This is where coordination matters.

Suppose the NUA transaction causes some amount to be included in ordinary taxable income.

You also want to complete a Roth conversion that year.

Those taxable events need to be viewed together.

A Roth conversion amount that looked reasonable before the NUA transaction may need to be reevaluated after the full income picture is known.

Could I Do the Roth Conversion in a Different Year?

Potentially.

Maybe the NUA transaction occurs in the retirement year.

Maybe Roth conversions are larger in subsequent years.

Maybe smaller conversions are used in the NUA year.

Maybe another sequence models better.

Don’t assume every tax strategy has to happen at maximum size in the same calendar year.

What About Medicare?

If you’re approaching or enrolled in Medicare, taxable income from retirement transactions can matter for income-related Medicare premium calculations under applicable rules.

Roth conversion income can be part of that income picture.

Taxable amounts connected to other retirement transactions can matter too.

That doesn’t mean you should avoid a strategy solely because of Medicare.

It means Medicare belongs in the comparison.

What About Future RMDs?

Traditional IRA assets can eventually become subject to required minimum distribution rules under current federal law.

Roth conversions can potentially reduce the traditional retirement balance that remains subject to future RMD calculations relative to an otherwise identical no-conversion scenario.

An NUA strategy may move qualifying employer securities outside the tax-deferred plan into a taxable account.

Those are different ways of changing where retirement assets live.

What About My Kids?

Now we get into legacy planning.

You may ultimately leave:

• Traditional IRA assets
• Roth assets
• Taxable company stock
• Other taxable investments
• Cash

Those assets can have different income-tax and beneficiary characteristics.

Don’t evaluate NUA solely based on what happens to you during the year of distribution.

Basis at Death Can Make the Analysis More Complicated

Taxable assets can have different basis rules at death than retirement accounts.

NUA stock can add additional complexity because the NUA portion may have special treatment.

Estate and beneficiary planning should therefore be coordinated with qualified tax and legal professionals.

Don’t assume all appreciation in inherited NUA stock receives the same treatment as ordinary taxable brokerage assets.

“I Just Want to Simplify Everything”

This is one of the strongest reasons retirees roll a 401(k) into an IRA.

You think:

“I have accounts everywhere. I want one account and one statement.”

That desire makes sense.

But simplification should happen after you identify any tax options you could lose.

Don’t trade away a potentially valuable choice just to clean up your account list faster.

“We Should Be Able to Handle This Ourselves”

You understand your 401(k).

You understand your company stock.

You watched it for 25 years.

You think:

“We should be able to handle this ourselves.”

Then someone asks:

What’s your plan cost basis?

Does the stock qualify?

Have you taken prior distributions?

What’s the triggering event?

What happens to the rest of the plan?

What happens if you sell the stock?

How does it compare with Roth?

What happens to future RMDs?

What happens to the surviving spouse?

Now you’re not making a simple rollover decision anymore.

“I Don’t Want to Ask My Kids for Help”

This is why the goal isn’t merely paying the least tax this year.

You think:

“I don’t want to ask my kids for help.”

You want enough retirement income.

You want flexibility.

You don’t want one concentrated stock position destroying the plan.

You don’t want unnecessary taxes consuming money you spent decades accumulating.

And you don’t want your children sorting through a mess because you never made a decision.

“What If We Mess This Up and Regret It?”

This decision can feel especially permanent.

You think:

“What if we mess this up and regret it?”

What if you roll the stock into an IRA and later discover NUA would have modeled better?

What if you use NUA and the stock crashes?

What if you sell too soon?

What if you hold too long?

What if the Roth strategy would have produced the better long-term outcome?

You can’t remove every uncertainty.

But you can compare the choices before making the irreversible transaction.

The Identity Conflict: Loyal Employee vs. Retired Investor

For 30 years, owning company stock may have felt like confidence.

Loyalty.

Participation.

You weren’t just an employee.

You were an owner.

Retirement changes the question.

You’re no longer building your career.

You’re trying to protect retirement income for the next 25 or 30 years.

The stock doesn’t know you worked there.

Your retirement portfolio has to work for the person you are now, not the employee you used to be.

NUA Can Be Tax-Efficient and Still Be the Wrong Retirement Strategy

This deserves emphasis.

Maybe NUA produces attractive projected tax treatment.

But what if it leaves 35% of your liquid retirement wealth tied to one stock?

Maybe selling immediately solves the concentration issue.

Maybe the resulting capital gain needs to be modeled.

Maybe NUA still wins.

Maybe it doesn’t.

Tax efficiency is one objective. Retirement durability is the bigger objective.

Roth Can Be Attractive and Still Be the Wrong Choice for Those Shares

The reverse is also true.

Maybe you love the idea of Roth.

No lifetime RMDs for the original owner under current federal rules.

Potentially tax-free qualified distributions.

Tax diversification.

But that doesn’t automatically mean every retirement asset should be pushed through a Roth conversion.

If specific company shares have another potentially favorable tax treatment available, compare it first.

What Should You Gather Before Making the Decision?

Start with information.

• Current 401(k) statement
• Value of employer stock
• Plan cost basis of employer stock
• Number of shares
• Plan distribution options
• Prior distribution history
• Employment separation date
• Other retirement accounts
• Taxable investments
• Cash reserves
• Projected retirement income
• Social Security information
• Pension information
• Beneficiary goals

Then get qualified professionals involved before executing the transaction.

This Is Where Roth Blueprint Software Comes In

I don’t want to look at a $1.8 million 401(k) and say:

“Convert it.”

I also don’t want to see company stock and automatically say:

“Use NUA.”

That’s not enough analysis.

Using our Roth Blueprint software, we can assess thousands of potential modeled Roth conversion scenarios around the broader retirement picture.

When employer stock and potential NUA treatment are involved, the NUA transaction itself should be reviewed with qualified tax, investment, and plan professionals, and then the resulting retirement balances and Roth conversion choices can be compared.

What Can We Compare?

We can assess different:

• Roth conversion amounts
• Conversion years
• Multi-year conversions
• Variable annual conversions
• No conversion
• Traditional IRA balances
• Roth balances
• Taxable investment balances
• Cash reserves
• Retirement spending
• Projected conversion taxes
• Different approaches to addressing conversion taxes
• Social Security timing
• Pension income
• Potential Medicare considerations
• Projected RMDs
• Surviving-spouse outcomes
• Beneficiary outcomes
• Legacy outcomes

The NUA-specific tax calculations, eligibility, distribution requirements, cost basis, securities decisions, and tax reporting should be coordinated with the appropriate qualified professionals.

Example: Make the Strategies Compete

Suppose you’re 62.

Your 401(k) is worth $1.8 million.

Of that:

• $1.3 million is diversified plan investments
• $500,000 is employer stock
• The employer stock has a $120,000 plan cost basis

You also have:

• $300,000 taxable investments
• $200,000 cash
• $150,000 Roth IRA

Instead of automatically rolling everything, compare broad strategies.

Scenario A: Evaluate an otherwise appropriate traditional IRA rollover and no Roth conversion.

Scenario B: Evaluate the rollover and a multi-year Roth conversion strategy.

Scenario C: Have qualified professionals evaluate whether the employer stock qualifies for NUA treatment while other eligible plan assets follow a separate rollover strategy.

Scenario D: Evaluate an NUA strategy plus Roth conversions of selected tax-deferred assets over several years.

Scenario E: Compare alternative timing and conversion amounts based on retirement income, liquidity, taxes, and other planning considerations.

Now you’re comparing actual retirement strategies instead of assuming every dollar needs identical treatment.

The Retirement Math Method™

This is why we use our Retirement Math Method™.

I don’t start with:

“Roll everything.”

I don’t start with:

“Convert everything.”

And I don’t start with:

“NUA is always better for company stock.”

Those are shortcuts.

Maybe the NUA strategy deserves serious consideration.

Maybe the cost basis is too high for it to provide enough value.

Maybe NUA is attractive for the employer stock while Roth conversions are attractive for other retirement assets.

Maybe diversification changes the decision.

Maybe future RMDs change it.

Maybe surviving-spouse planning changes it.

Maybe the IRA rollover strategy wins.

I don’t try to sell you on the strategy. I make the strategy prove itself with the math.

Let the math do the talking.

Frequently Asked Questions About NUA and Roth Conversions

What is NUA?

Net Unrealized Appreciation generally refers to appreciation in qualifying employer securities held inside an employer retirement plan over the plan’s cost basis. Special federal tax treatment may apply when applicable requirements are satisfied.

Is NUA the same as a Roth conversion?

No. They are different tax strategies. A Roth conversion moves selected tax-deferred retirement assets into Roth and generally creates taxable income to the extent the converted amount would otherwise be taxable. NUA involves special tax treatment potentially available for qualifying employer securities distributed from an employer plan under applicable rules.

Should I roll company stock from my 401(k) into an IRA?

Don’t make the decision automatically. If the shares may qualify for NUA treatment, compare the potential NUA strategy before rolling the employer securities into an IRA.

Can I use NUA and still do Roth conversions?

Potentially. NUA may be evaluated for qualifying employer securities while Roth conversions are separately evaluated for other tax-deferred retirement assets. The transactions and their tax consequences should be coordinated carefully.

Is NUA always better when my company stock has appreciated?

No. Plan cost basis, current value, amount of appreciation, ordinary income and capital gain tax treatment, state taxes, diversification, liquidity, future investment returns, retirement income, estate goals, and applicable NUA requirements can all change the result.

What happens if I already rolled the company stock into an IRA?

Don’t assume an NUA opportunity can simply be recreated using employer shares already rolled into an IRA. Have a qualified tax professional review the actual transaction and circumstances.

Do I have to keep NUA stock forever?

No general retirement-planning principle requires you to hold employer stock forever merely because an NUA strategy was used. The subsequent investment decision should consider diversification, taxes, risk tolerance, retirement goals, and the applicable tax treatment of a sale.

Can company stock lose value after an NUA distribution?

Yes. NUA treatment doesn’t protect the stock from investment losses. Employer securities remain subject to company-specific and market risk.

Does NUA eliminate taxes?

No. NUA changes the potential federal tax treatment of qualifying appreciation when applicable requirements are met. It doesn’t make the transaction universally tax-free.

Can Roth Blueprint determine whether I qualify for NUA?

NUA eligibility and the tax treatment of an employer-stock distribution should be determined with qualified tax and plan professionals using the actual plan documents, cost basis, distribution history, employment events, and current law. Roth Blueprint can then be used as part of the broader process of comparing modeled Roth conversion strategies and retirement outcomes.

Don’t Let a Routine Rollover Make the Decision for You

That’s the takeaway.

If your 401(k) contains only diversified funds and cash, your rollover analysis may be relatively straightforward.

If it contains hundreds of thousands of dollars of highly appreciated employer stock, slow down.

Before moving those shares, find out:

What is the cost basis?

Could the shares qualify for NUA treatment?

What would the potential tax treatment look like?

What happens if you use Roth instead?

What happens if you combine the strategies?

What does the concentration risk look like?

What happens to your retirement income?

What happens to your spouse?

What happens to your beneficiaries?

You don’t have to use NUA. You just don’t want to discover it after you’ve already given up the option.

Have $500,000+ in Tax-Deferred Assets and Company Stock in Your 401(k)? Let’s Run the Math.

If you’re approaching retirement with $500,000, $750,000, $1 million, $2 million, or more in tax-deferred retirement accounts and part of your employer plan is invested in company stock, don’t automatically move everything before reviewing the tax choices.

When you meet with me, we can use our Roth Blueprint software and Retirement Math Method™ to assess thousands of potential modeled Roth conversion scenarios around your broader retirement picture.

We can compare:

• No Roth conversion
• Smaller annual conversions
• Larger annual conversions
• Multi-year conversions
• Variable annual conversions
• Traditional retirement-account balances
• Roth balances
• Taxable investment balances
• Cash reserves
• Retirement spending
• Projected conversion taxes
• Social Security timing
• Pension income
• Potential Medicare considerations
• Projected RMDs
• Surviving-spouse outcomes
• Beneficiary outcomes
• Legacy outcomes

If NUA may be relevant, your qualified tax, investment, and plan professionals should evaluate the actual employer shares, cost basis, eligibility requirements, distribution structure, securities considerations, and tax consequences before the shares move.

Maybe NUA deserves serious consideration for the company stock.

Maybe Roth conversions make more sense for other retirement assets.

Maybe a combination produces the stronger modeled retirement outcome.

Maybe the rollover strategy wins.

Don’t let a default rollover decide it for you.

We don’t sell you a retirement strategy. We run the math and let you decide.

Let the math do the talking.

Schedule Your Roth Conversion Strategy Appointment

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Important Disclosure

This article is for educational purposes only and isn’t intended as individualized tax, legal, accounting, investment, securities, retirement-plan, insurance, estate-planning, Medicare, Social Security, or retirement-planning advice. FPP Financial does not provide tax or legal advice. Net Unrealized Appreciation is a specialized federal tax concept involving qualifying employer securities held in certain employer retirement plans, and favorable NUA treatment is not available in every situation. Eligibility, triggering events, lump-sum distribution requirements, timing, plan cost basis, prior distributions, plan terms, securities transferred, subsequent sales, tax rates, state tax treatment, and other circumstances can materially affect the result. A rollover or distribution may be irreversible or may cause a taxpayer to lose access to a tax treatment that might otherwise have been available. Do not execute an employer-plan rollover, distribute employer securities, sell company stock, or attempt an NUA transaction based solely on this article. Employer stock remains subject to investment risk, including concentration risk and loss of principal. Favorable tax treatment does not make a concentrated stock position suitable for every investor. Roth conversions generally create taxable income to the extent converted amounts would otherwise be taxable. Qualified Roth IRA distributions are generally tax-free under current federal rules when applicable requirements are satisfied. Taxable Roth conversion income, NUA-related taxable amounts, capital gains, investment income, retirement distributions, pensions, Social Security benefits, and other income can affect federal and state income taxes, marginal tax rates, the federal calculation determining how much of Social Security benefits is included in taxable income, ACA Marketplace premium tax credits when applicable, Medicare premiums, estimated tax requirements, Net Investment Income Tax calculations in applicable circumstances, liquidity, and other parts of a financial plan. Required minimum distribution rules vary based on birth year, account type, beneficiary status, and current law, and required distribution amounts aren’t eligible for Roth conversion. Roth conversions can potentially reduce future traditional retirement-account balances and future RMDs relative to an otherwise identical no-conversion scenario, but no specific tax, NUA, investment, capital-gain, Medicare, Social Security, RMD, retirement-income, liquidity, surviving-spouse, beneficiary, or legacy outcome is guaranteed. Roth Blueprint calculations and other projections are based on assumptions and information entered into the analysis and aren’t guarantees of future tax results, NUA treatment, capital-gain treatment, account values, investment performance, retirement income, Medicare premiums, Social Security outcomes, RMD reductions, surviving-spouse outcomes, beneficiary outcomes, legacy results, liquidity, or product performance. Insurance and annuity products may contain fees, charges, surrender periods, liquidity restrictions, eligibility requirements, bonus provisions, participation rates, caps, spreads, crediting methods, income features, guarantees, and other contractual terms. Guarantees are subject to the claims-paying ability of the issuing insurer. A carrier bonus isn’t an IRS tax credit and doesn’t transfer the client’s tax liability to an insurance company. Statements that contractual carrier bonus value may economically offset some or potentially all of a modeled conversion-tax cost aren’t statements that the tax disappears or that the carrier directly pays the client’s tax liability. Before completing a Roth conversion, employer-plan rollover, NUA transaction, employer-stock distribution or sale, changing an investment allocation, making estimated tax payments, purchasing an insurance or annuity product, or making other retirement decisions, consider working with qualified tax, legal, accounting, financial, investment, securities, retirement-plan, insurance, Medicare, Social Security, estate-planning, and other appropriate professionals who can evaluate your individual circumstances, plan documents, transaction history, and current rules.