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Retirees of any age with large IRAs must understand that their IRAs can be hit with estate and income taxes when they die. And RMD rules could cause future income tax burdens while they are alive. However, IRA owners between ages 59½ and 70½ have a great opportunity to use the new tax law to their advantage.
If they are in lower tax brackets (10% or 15%), they can remove just enough money from their IRAs to use up those brackets. When they turn 70½, they will have reduced the amount subject to RMD. Their future tax brackets may be lowered because of smaller withdrawals, and they will have shifted more of their assets out of their IRA. And most assets held outside an IRA pass income-tax-free to beneficiaries.
