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Mainstreet Financial Education · Tax Year 2026

5 tax traps in the first 5 years of retirement.

Neither too early nor too late is automatically right. These are the five places retirees most often give up dollars they did not have to.

The five that catch people most often

The years before required minimum distributions start are your best window to control taxes. These are the traps to avoid.

1

Letting tax-deferred accounts grow untouched

Required minimum distributions begin at age 73 for those born 1951 to 1959, and at 75 for those born in 1960 or later. Once they start, they force large, fully taxable withdrawals every year.

2

Mistiming Roth conversions

Converting too much in one year can push you into a higher bracket, trigger Medicare IRMAA surcharges, and make more of your Social Security taxable. Spreading conversions across years usually costs less.

3

Ignoring Social Security tax thresholds

Past $25,000 of combined income single, or $32,000 joint, each added dollar can make up to 85 cents of your benefits taxable. A poorly timed withdrawal here can be taxed at a surprisingly high effective rate.

4

Triggering Medicare IRMAA surcharges

IRMAA is set each year from your income two years earlier. In 2026, income above $109,000 single or $218,000 joint in 2024 adds a monthly surcharge per person to your Part B and Part D premiums.

5

Skipping heir and survivor planning

Most non-spouse heirs must empty an inherited IRA within 10 years. A surviving spouse loses one Social Security check and begins filing single, often at higher rates, so plan for both events early.

Teaching, never a sales pitch

Sequencing the breaks is the plan.

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