The Hidden Tax Cost of a Large IRA

A large IRA balance is a sign that you’ve saved well for retirement. But many pre-retirees are surprised to learn that a large IRA can also create significant, often overlooked tax costs that show up later in retirement.

These hidden costs don’t usually appear all at once. Instead, they surface through required minimum distributions (RMDs), higher taxation of Social Security benefits, and increased Medicare premiums, quietly reducing the income you expected your retirement savings to provide.

If you’re within 5 to 10 years of retirement, understanding how these taxes work and planning ahead can give you far more control over how much of your money stays with you instead of going to the IRS.

A large IRA balance is a sign that you’ve saved well for retirement. But many pre-retirees are surprised to learn that a large IRA can also create significant, often overlooked tax costs that show up later in retirement.

✅ Take the Free Retirement Readiness Assessment

📞 Schedule a Complimentary Call to talk through your retirement options with our team

You’ll learn:

✔️ Why a large IRA isn’t fully “your money” yet from a tax standpoint

✔️ How required minimum distributions (RMDs) can force taxable income

✔️ Why IRA withdrawals can increase the taxation of Social Security benefits

✔️ How higher income from IRA withdrawals can lead to increased Medicare premiums (IRMAA)

✔️ When Roth conversions may help reduce long-term tax exposure

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