Bogleheads On Investing Podcast · bogleheads

Episode 85, Ed Slott, CPA, new tax laws from OBBBA, Roth conversions, and more; host Jon Luskin

·56 min·3 clips

Ed Slott says the secret is to “always pay taxes at the lowest rates,” even before they’re required.

1. Bogleheads On Investing Podcast Episode 85 focuses on Ed Slott, CPA and the One Big Beautiful Bill Act. 2. Jon Luskin hosts the episode, Ed Slott answers tax questions, and the Bogleheads community supplies the questions from the forum and social media. 3. The episode asks how the new tax law changes affect Roth conversions, senior deductions, business owners, and charitable giving. 4. Ed Slott says the new law has provisions starting in 2025, 2026, 2028, 2029, or permanently, and he calls the result “a game of whack-a-mole.” 5. He says the $6,000 senior deduction phases out at $75,000 for single filers and $150,000 for joint filers, which makes the headline number smaller in practice. 6. Luskin adds context that the senior deduction runs through 2025 to 2028 and that Roth conversions can push people into the phase-out range. 7. Slott says Roth conversions let people control the tax bracket they use instead of waiting for required minimum distributions at age 73. 8. He repeats his rule that people should “always pay taxes at the lowest rates,” even if that means paying tax before it is required. 9. He says people in their 60s often have the best Roth conversion window because they can still use low brackets. 10. He points to the QBI deduction as a major retained benefit for many pass-through businesses under the new law. 11. Slott says some professionals can use a Roth conversion to increase the QBI deduction, which he calls a rare counterintuitive result. 12. He warns that too much conversion can eliminate the deduction, so year-end income projections matter. 13. Slott says he is not a fan of traditional 401(k) deductions because the tax bill comes back later in retirement. 14. He argues that Roth 401(k) contributions and Roth IRAs fit his preference for paying tax now at lower rates. 15. He says the new Trump accounts do not become available until July 4 next year, and newborns born between January 1, 2025 and 2028 get a $1,000 seed. 16. He notes that the accounts cannot be touched until age 18, and that earnings are taxed as ordinary income rather than at long-term capital gains rates. 17. On charitable giving, Slott says next year brings a $1,000 or $2,000 above-the-line deduction for non-itemizers, but he also says high-tax-state taxpayers may want to front-load donations this year. 18. He describes the new SALT cap increase to $40,000 and warns that the phaseout between $500,000 and $600,000 of income can create a very high effective rate. 19. The conversation is direct, technical, and practical, with Luskin steering listener questions and Slott answering in a forceful, teacherly style. 20. Investors who care about Roth conversions, tax law, and retirement withdrawal strategy will get the most value from this episode, while listeners looking for market news can probably skip it.

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