Conventional wisdom suggests that conversion of a traditional IRA into a Roth IRA is better for younger individuals in lower tax brackets. The tax cost will be less, and the years of investment growth will be more, than would be the case for an older individual. However, the recent stock market downturn may present an opportunity for older individuals, especially if they have significant IRA balances that could end up being inherited.

For example, if you ended last year with a traditional IRA account balance of $2,000,000, it may have decreased $500,000 by mid-year! History demonstrates that the markets will recover, and, thus, it is likely this unrealized loss will be made up and the account will increase beyond the recovered loss over time. The recovered loss, like all of the distributions from the traditional IRA, will be income taxed upon distribution. But if the amount of that unrealized loss, $500,000, was converted into a Roth IRA in equal amounts of $250,000 over two years, decreased by the applicable income tax (assuming, conservatively, a combined effective rate of 40%), the net, $300,000, and any subsequent growth would, ultimately, be distributed tax free.
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John J. Donner will give a presentation on the forms of business organization on Saturday, August 20, 2022, at a Starting and Managing Your Own Business workshop at the Calspan Building Complex, located at 4411 Genesee Street Cheektowaga, NY 14225 (opposite the Buffalo airport). This all-day, in-person workshop begins at 8:30 am and is sponsored by SCORE. For registration and additional information on this event, visit the “Take a Workshop” tab of the SCORE Buffalo Niagara website (buffaloniagara.score.org) and click on the event.

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The Buffalo Business Forward Small Business Grant Program announced by Mayor Brown on October 26, 2021, will provide grants up to $25,000 to 50 small businesses facing hardships due to the pandemic and located within certain Buffalo neighborhoods. Read more

Decisions by state and Erie County officials that prompted an order to close a laser-tag center in Amherst as a Covid-19 precaution “were haphazard and devoid of logic,” according to a judge’s ruling Monday. State Supreme Court Justice Emilio Colaiacovo granted Lasertron a preliminary injunction to keep authorities from enforcing the order.

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