The year of a spouse’s death is a difficult time. It is also a crucial period for making sure the surviving spouse has enough to provide for their remaining years. Starting a financial plan early on can help mitigate the stress associated with navigating financial decisions when this occurs.
Unless you have a dependent and meet the other requirements to file your taxes as a qualifying widow(er) or remarry, the year of a spouse’s death is the last time you will be able to use the married filing jointly tax brackets. In future years, a surviving spouse will file as single and be subject to higher tax rates.
Because of this, Roth conversions may be appropriate for surviving spouses in the year of death. It may be better to pay the taxes in your last year filing jointly rather than later as a single person.
You may also want to consider selling your home. If you have equity in the home, the net proceeds from the sale can provide you with the money you need to pay the taxes associated with the Roth conversion. Proceeds from life insurance may also assist.
If you have questions on this or any other financial or estate planning topic, please call us at 925-300-3222
This commentary reflects the personal opinions, viewpoints and analyses of the Integrity Wealth Partners, LLC employees providing such comments, and should not be regarded as a description of advisory services provided by Integrity Wealth Partners, LLC or performance returns of any Integrity Wealth Partners, LLC client. The views reflected in the commentary are subject to change at any time without notice. Nothing in this commentary constitutes investment advice, performance data, or any recommendation that any particular security, portfolio of securities, transaction or investment strategy is suitable for any specific person. Any mention of a particular security and related performance data is not a recommendation to buy or sell that security. Integrity Wealth Partners, LLC manages its clients' accounts using a variety of investment techniques and strategies, which are not necessarily discussed in the commentary. Investments in securities involve the risk of loss. Past performance is no guarantee of future results.
