Why would there be an addition to the taxable account if the client is retired?

You may see additions to a taxable account in any period during retirement when the plan includes "overflow" cash flows that are not being spent. Below are a few examples where you may see these additions in a plan.

• The required minimum distributions (RMDs) for a household exceed the amount needed to fund expenses. In this case, excess funds withdrawn from tax-deferred accounts due to RMDs are deposited in a taxable account. (RMDs cannot be rolled over to another tax-deferred account or converted to a Roth account.) 
• Incoming cash flows from non-portfolio sources, such as rental income or wages earned during retirement, are greater than the amount to be spent. The excess will be saved to a taxable account.
• The plan includes a large one-time cash flow in a given year, such as the sale of a house or other asset. In this case, any amount over and above what is needed to fund that month/year's spending will be added to a taxable account.

If the plan does not already contain a taxable account, you will see a taxable account added to the plan to handle these "overflow" portfolio additions.