Estate Planning Calculator
Legacy Distribution Planner: What It Calculates and How to Read the Result
Quick answer
How you structure the transfer of assets at death determines the after-tax inheritance your heirs actually receive. Roth IRAs pass income-tax-free, taxable brokerage gets a step-up in basis that eliminates accumulated capital gains, and traditional IRAs are subject to a 10-year mandatory distribution window under the SECURE Act, which can push high-income heirs into elevated brackets. The order in which you spend, convert, and leave each account type can swing six figures of family wealth.
Simplified: horizon uses end age
Used only for annual yield tax drag.
Editable assumption
Optional simplified
Simple effective-rate model (editable)
Default values are editable assumptions
Used to demonstrate withdrawal-order impact
Applies only to the “Roth conversion” strategy
- Tax drag / lifetime taxes: ~94,045
- Small assumption changes can materially change outcomes.
- A coordinated plan can reduce risk and improve efficiency.
Schedule a Strategic Fit Interview to confirm you’re optimized and protected against downside scenarios.
No commitment. No sales agenda. 30 minutes with a flat-fee CFP & Enrolled Agent.
| Strategy | Net inheritance | Total taxes | Net worth at death | Tax drag |
|---|---|---|---|---|
| Baseline (no proactive strategy) | $7,689,116.53 | $94,045.49 | $8,785,585.81 | $185,526.50 |
| Roth conversion glidepath | $7,689,116.53 | $94,045.49 | $8,785,585.81 | $185,526.50 |
| Tax-deferred spend-first (for gifts) | $7,689,116.53 | $94,045.49 | $8,785,585.81 | $185,526.50 |
| Bucket | Gross | Taxes | Net to heirs |
|---|---|---|---|
| Taxable brokerage | $2,804,844.27 | $0.00 | $2,804,844.27 |
| Tax-deferred (IRA/401k) | $4,983,951.29 | $1,096,469.28 | $3,887,482.00 |
| Roth | $996,790.26 | $0.00 | $996,790.26 |
| Other / real estate | $0.00 | $0.00 | $0.00 |
| Estate tax | $0.00 | $0.00 | $7,689,116.53 |
| Age | Taxable | Pre-tax | Roth | Other | Taxes | Fees | Gifts | End total |
|---|---|---|---|---|---|---|---|---|
| 66 | $631,650.00 | $1,055,000.00 | $211,000.00 | $0.00 | $1,350.00 | $9,000.00 | $0.00 | $1,897,650.00 |
| 67 | $664,969.54 | $1,113,025.00 | $222,605.00 | $0.00 | $1,421.21 | $9,488.25 | $0.00 | $2,000,599.54 |
| 68 | $700,046.68 | $1,174,241.38 | $234,848.28 | $0.00 | $1,496.18 | $10,003.00 | $0.00 | $2,109,136.33 |
| 69 | $736,974.14 | $1,238,824.65 | $247,764.93 | $0.00 | $1,575.11 | $10,545.68 | $0.00 | $2,223,563.72 |
| 70 | $775,849.53 | $1,306,960.01 | $261,392.00 | $0.00 | $1,658.19 | $11,117.82 | $0.00 | $2,344,201.54 |
| 71 | $816,775.59 | $1,378,842.81 | $275,768.56 | $0.00 | $1,745.66 | $11,721.01 | $0.00 | $2,471,386.96 |
| 72 | $859,860.50 | $1,454,679.16 | $290,935.83 | $0.00 | $1,837.75 | $12,356.93 | $0.00 | $2,605,475.50 |
| 73 | $905,218.15 | $1,534,686.51 | $306,937.30 | $0.00 | $1,934.69 | $13,027.38 | $0.00 | $2,746,841.96 |
| 74 | $952,968.40 | $1,619,094.27 | $323,818.85 | $0.00 | $2,036.74 | $13,734.21 | $0.00 | $2,895,881.53 |
| 75 | $1,003,237.49 | $1,708,144.46 | $341,628.89 | $0.00 | $2,144.18 | $14,479.41 | $0.00 | $3,053,010.84 |
| 76 | $1,056,158.26 | $1,802,092.40 | $360,418.48 | $0.00 | $2,257.28 | $15,265.05 | $0.00 | $3,218,669.15 |
| 77 | $1,111,870.61 | $1,901,207.49 | $380,241.50 | $0.00 | $2,376.36 | $16,093.35 | $0.00 | $3,393,319.59 |
| 78 | $1,170,521.79 | $2,005,773.90 | $401,154.78 | $0.00 | $2,501.71 | $16,966.60 | $0.00 | $3,577,450.46 |
| 79 | $1,232,266.81 | $2,116,091.46 | $423,218.29 | $0.00 | $2,633.67 | $17,887.25 | $0.00 | $3,771,576.57 |
| 80 | $1,297,268.89 | $2,232,476.49 | $446,495.30 | $0.00 | $2,772.60 | $18,857.88 | $0.00 | $3,976,240.68 |
| 81 | $1,365,699.82 | $2,355,262.70 | $471,052.54 | $0.00 | $2,918.85 | $19,881.20 | $0.00 | $4,192,015.06 |
| 82 | $1,437,740.48 | $2,484,802.15 | $496,960.43 | $0.00 | $3,072.82 | $20,960.08 | $0.00 | $4,419,503.06 |
| 83 | $1,513,581.30 | $2,621,466.27 | $524,293.25 | $0.00 | $3,234.92 | $22,097.52 | $0.00 | $4,659,340.81 |
| 84 | $1,593,422.71 | $2,765,646.91 | $553,129.38 | $0.00 | $3,405.56 | $23,296.70 | $0.00 | $4,912,199.00 |
| 85 | $1,677,475.76 | $2,917,757.49 | $583,551.50 | $0.00 | $3,585.20 | $24,561.00 | $0.00 | $5,178,784.74 |
| 86 | $1,765,962.60 | $3,078,234.15 | $615,646.83 | $0.00 | $3,774.32 | $25,893.92 | $0.00 | $5,459,843.59 |
| 87 | $1,859,117.13 | $3,247,537.03 | $649,507.41 | $0.00 | $3,973.42 | $27,299.22 | $0.00 | $5,756,161.57 |
| 88 | $1,957,185.56 | $3,426,151.57 | $685,230.31 | $0.00 | $4,183.01 | $28,780.81 | $0.00 | $6,068,567.44 |
| 89 | $2,060,427.10 | $3,614,589.90 | $722,917.98 | $0.00 | $4,403.67 | $30,342.84 | $0.00 | $6,397,934.98 |
| 90 | $2,169,114.63 | $3,813,392.35 | $762,678.47 | $0.00 | $4,635.96 | $31,989.67 | $0.00 | $6,745,185.44 |
| 91 | $2,283,535.42 | $4,023,128.93 | $804,625.79 | $0.00 | $4,880.51 | $33,725.93 | $0.00 | $7,111,290.14 |
| 92 | $2,403,991.92 | $4,244,401.02 | $848,880.20 | $0.00 | $5,137.95 | $35,556.45 | $0.00 | $7,497,273.14 |
| 93 | $2,530,802.49 | $4,477,843.07 | $895,568.61 | $0.00 | $5,408.98 | $37,486.37 | $0.00 | $7,904,214.18 |
| 94 | $2,664,302.32 | $4,724,124.44 | $944,824.89 | $0.00 | $5,694.31 | $39,521.07 | $0.00 | $8,333,251.65 |
| 95 | $2,804,844.27 | $4,983,951.29 | $996,790.26 | $0.00 | $5,994.68 | $41,666.26 | $0.00 | $8,785,585.81 |
Taxable accounts: annual tax drag applies only to the yield (dividends/interest) at your effective rate. Long-term capital gains are modeled when assets are sold to fund gifts/taxes, and at death only if step-up is OFF.
Tax-deferred: no annual tax drag; withdrawals for gifts are grossed-up for ordinary income taxes. Roth is modeled as tax-free.
Other / real estate: if step-up is OFF, we assume cost basis is $0 (conservative simplification).
Inherited IRA: modeled as a simplified “haircut” based on your selected beneficiary bracket (not a full 10-year rule schedule).
Estate tax: fully user-editable; defaults are placeholders. Tax law changes frequently, so update assumptions.
This tool is designed to be transparent and fast, not to replicate tax code precisely. Treat results as directional and stress-test key assumptions.
- No Social Security, pensions, RMD rules, IRMAA, deductions/credits, or charitable strategy detail beyond a simplified % bequest.
- No state income tax modeling by state: only your chosen effective tax rates.
- Spouse modeling is simplified; end age is treated as a single “death” event for household planning.
For education only; not tax, legal, or investment advice. Hypothetical projections are highly sensitive to assumptions and tax law changes.
Estate and income tax rules are complex. Consult qualified professionals (CPA/attorney) for guidance specific to your situation.
If you want a personalized distribution and legacy plan, consider scheduling a consultation with Singh PWM.
What This Calculator Actually Answers
This planner models the after-tax inheritance your beneficiaries receive under different end-of-life account structures: a portfolio leaning heavily on traditional IRAs (large 10-year SECURE distribution problem), a portfolio shifted toward Roth via conversions (no income tax to heirs), and a portfolio that uses the step-up in basis on taxable brokerage strategically.
It also models the impact of charitable beneficiaries: a charitable remainder trust, a donor-advised fund funded with appreciated stock, or naming a charity as the direct beneficiary of a traditional IRA (which removes income tax from the inheritance equation for that portion).
How to Read the Result
The key number is the after-tax inheritance, not the gross balance left at death. A $2M traditional IRA inherited by a child in the 32% federal bracket produces roughly $1.36M of after-tax inheritance after the SECURE 10-year distribution window. The same $2M in a Roth IRA produces $2M of after-tax inheritance. The same $2M in a long-held taxable account with $1M of embedded gains produces nearly $2M after-tax (the step-up eliminates the gain at death).
This is why Roth conversion strategy and the order in which you draw down accounts in retirement is, at this asset level, also estate planning. The two cannot be separated.
Common Mistakes
- Naming the estate (rather than a person) as the beneficiary of a retirement account: this accelerates distribution and forfeits the 10-year SECURE window protection.
- Spending Roth assets first in retirement. Roths are the most valuable asset to leave to heirs and the worst to deplete early.
- Forgetting the spousal exception: a surviving spouse can roll an inherited IRA into their own IRA and resume normal RMD rules; the 10-year SECURE window applies only to non-spouse beneficiaries.
- Naming a trust as beneficiary without ensuring it is a 'see-through' trust under IRS rules: non-conforming trusts can lose the deferred-distribution benefit entirely.
- Failing to update beneficiary designations after divorce, death of a beneficiary, or other major life events. The beneficiary form supersedes the will for retirement accounts.
When This Calculator Is Not the Right Tool
This tool models the financial outcome of legacy decisions but does not draft the documents that implement them. Trusts, beneficiary designations, charitable remainder trusts, and the specific structuring of an estate plan require coordination with an estate attorney. Use this calculator to identify the strategy; then implement it with legal counsel.
Frequently Asked Questions
What changed about inherited IRAs under the SECURE Act?
Before SECURE (2020), a non-spouse beneficiary could 'stretch' an inherited traditional IRA over their own lifetime, a powerful deferral. After SECURE, non-spouse beneficiaries (other than minor children, disabled or chronically ill individuals, and beneficiaries less than 10 years younger than the decedent) must fully distribute the inherited IRA within 10 years of the original owner's death. This compresses what was once a 30+ year tax deferral into 10 years, often pushing the beneficiary into materially higher tax brackets.
Should I leave a traditional IRA to a charity instead of my children?
Often yes, for the IRA portion. A charity pays no income tax on the inherited IRA, so 100% of the balance reaches the charity. A non-spouse human beneficiary may net 65–70 cents on the dollar after federal and state tax under the 10-year window. If you have both charitable intent and human heirs, leaving the IRA to charity and the taxable/Roth assets (which get step-up or pass tax-free) to heirs is structurally more efficient.
Does Arizona have an estate or inheritance tax?
No. Arizona has neither a state estate tax nor a state inheritance tax. Federal estate tax applies only to estates above the federal exemption (~$13.61M per person, indexed annually). For most Arizona households below that threshold, the legacy question is entirely an income-tax question for the beneficiary, not an estate-tax question.
How does the step-up in basis work?
When you die, your heirs receive your taxable brokerage assets with a cost basis equal to the fair market value on your date of death, not your original purchase price. All accumulated capital gains during your lifetime disappear from the tax equation. This is why holding low-basis, highly appreciated stock until death (rather than selling it during retirement) can be a powerful estate strategy for the right households.