403b to Roth IRA Conversion?

[hospitalistmd]

Hello All,

I have been reading WCI for several years now and certainly appreciate all of the knowledge I have gained here.  This is my first post and I appreciate you reading.

My wife is an urgent care doc and will be changing jobs to another part-time position.  She currently has a 403b with about 70k in it at her current position.  The new job will be considered "PRN" and she will have no access to retirement vehicles.  I have 2 related questions.

1.  Should we consider converting her 403b to a Roth IRA and accepting the large tax ramifications this year (or over the next couple of years) or just leave it where it is at Fidelity in the 403b?

2.  Are there any ways to tax protect her money going forward if she is a W2 employee?

Few additional details:  I am a hospitalist with a yearly salary ~200k.  Her salary is ~55k.  We have no medical school debt (paid off!), are in our early 30's with 4 young kids.

I am so thankful for the information I have gleaned from this site, forum, recommended books.  Thanks for all of your help and advice.

[spiritrider]

You marginal federal tax bracket is 33% plus your marginal state bracket. It would make no sense to do a Roth conversion at those marginal tax rates.

If neither of you has pre-tax IRA balances, you should be doing Backdoor Roths.

[hospitalistmd]

Thanks for the comment Spiritrider!  I should have mentioned we contributed 11k per year to a backdoor roth and have no traditional IRAs.

Are there mechanisms to tax protect her income going forward?