Everyone needs income in retirement. But when you take money out of your retirement accounts, there can be big tax impacts. How can you be smart about using your retirement savings without paying the IRS too much in taxes?

In the following video, Dan Caplinger, The Motley Fool's director of investment planning, talks about some essential considerations in assessing the tax impact of tapping your retirement savings. Dan first notes that traditional IRAs and 401(k) accounts create taxable income when you make withdrawals, while Roth IRAs and 401(k)s don't. Dan points out that this can have huge implications beyond the immediate tax impact, as having too much taxable income can also lead to more of your Social Security benefits getting taxed, losing tax breaks due to phaseouts, and even missing out on eligibility for Obamacare subsidies. Dan also points out, though, that in some cases, it makes sense to have more taxable income, especially for those in the lowest two brackets for which certain capital gains and dividend income get taxed at 0%. Dan concludes that all the competing factors make tax planning complicated for retirees, but the smarter you are about it, the more of your savings you can keep out of the hands of the IRS.