5 Retirement Tax Myths That Sound Smart — Until You Do the Math

Group 1 - Many retirees mistakenly believe that their Social Security benefits are tax-free, but up to 85% of benefits may be taxable depending on provisional income thresholds [2][3] - Retirement income does not automatically result in a lower tax bracket, as required minimum distributions (RMDs) and other income sources can keep retirees in the same or higher tax brackets [4][5] - Waiting to withdraw from retirement accounts may lead to larger RMDs later, which are taxable and can push retirees into higher tax brackets [6][7] Group 2 - Roth conversions are not exclusively for high earners; they can be beneficial for retirees with temporarily lower income, allowing for tax-free withdrawals in the future [8]