Search found 6848 matches

Return to advanced search

Re: Father died. How to handle his company stock?

Any lawyer, accountant, or broker knows this stuff. Therefore, there's a larger concern here: the mother appears to be administering an estate without advice from an accountant or attorney, and under the guidance of a broker who has not explained the options to her. Therefore the broker should be du...
by Bob's not my name
Fri Aug 29, 2014 8:29 am
 
Forum: Personal Finance (Not Investing)
Topic: Father died. How to handle his company stock?
Replies: 8
Views: 570

Re: Father died. How to handle his company stock?

Gambler wrote:he had

Mom's filling out the paperwork to get it transferred to her.
The OP says the stock was held by the father.
by Bob's not my name
Fri Aug 29, 2014 7:28 am
 
Forum: Personal Finance (Not Investing)
Topic: Father died. How to handle his company stock?
Replies: 8
Views: 570

Re: Please Help - Personal Investments / AA

Income: combined income of 150-160K. wife’s tuition bill, paying with cash. Once she’s done (4 yrs), it’ll free up roughly 1.5K cash per month and will add roughly 30-40K to her annual income. The $2,000 Lifetime Learning Credit phases out for AGI $108,000 - $128,000. Assuming you have, say, $3,500...
by Bob's not my name
Fri Aug 29, 2014 7:20 am
 
Forum: Investing - Help with Personal Investments
Topic: Please Help - Personal Investments / AA
Replies: 1
Views: 143

Re: Father died. How to handle his company stock?

You don't need any records. There is a basis step-up on death. Sell the stock immediately.
by Bob's not my name
Fri Aug 29, 2014 7:04 am
 
Forum: Personal Finance (Not Investing)
Topic: Father died. How to handle his company stock?
Replies: 8
Views: 570

Re: Are assets split in kind or liquidated on death?

Probably too late to undertake at this time, but nursing care often places the elderly person in a 0% bracket, an ideal time to convert to Roth. In any case, the assets in the IRA should also be liquidated immediately (which in this case means selling the bond fund so everything's in the MM). Since ...
by Bob's not my name
Fri Aug 29, 2014 6:32 am
 
Forum: Investing - Help with Personal Investments
Topic: Are assets split in kind or liquidated on death?
Replies: 8
Views: 308

Re: Are assets split in kind or liquidated on death?

The assets are all liquidated immediately. It makes no sense to do otherwise because there is a basis step-up at death that eliminates capital gains (if you sell everything on the date of death the gains are precisely zero). The trustee incurs risk if she chooses to make or keep investments. Further...
by Bob's not my name
Fri Aug 29, 2014 5:17 am
 
Forum: Investing - Help with Personal Investments
Topic: Are assets split in kind or liquidated on death?
Replies: 8
Views: 308

Re: Taxes on Roth conversion at retirement

PA treats a TIRA like a Roth -- taxes the contribution but not the withdrawal.
by Bob's not my name
Tue Aug 26, 2014 11:12 am
 
Forum: Personal Finance (Not Investing)
Topic: Taxes on Roth conversion at retirement
Replies: 15
Views: 682

Re: Taxes on Roth conversion at retirement

Many states do not tax Social Security and pension income but most tax Roth conversions. Many states exempt Roth conversions from taxation, although many of the many apply age and dollar limits to the exemption. In a quick review, I counted 26 states that have no income tax or that have an income t...
by Bob's not my name
Tue Aug 26, 2014 10:37 am
 
Forum: Personal Finance (Not Investing)
Topic: Taxes on Roth conversion at retirement
Replies: 15
Views: 682

Re: Taxes on Roth conversion at retirement

OP is 35 years from RMDs so if we're talking nominal dollars a $113,000 RMD likely won't put him in the 25% bracket. I'm just pointing this out because sometimes we get hysterical about projected RMDs because we don't take inflation adjustment of the brackets, personal exemptions, and deductions int...
by Bob's not my name
Tue Aug 26, 2014 9:29 am
 
Forum: Personal Finance (Not Investing)
Topic: Taxes on Roth conversion at retirement
Replies: 15
Views: 682

Re: convince me not to use traditional IRA for house downpay

Exactly. If the government decides to provide you with a tax-deferred account for saving up a downpayment, why not take advantage of that? Most people withdraw from their retirement accounts when they buy a house, but it's not as obvious: they reduce their contributions in the early years of the mor...
by Bob's not my name
Tue Aug 26, 2014 7:52 am
 
Forum: Personal Finance (Not Investing)
Topic: convince me not to use traditional IRA for house downpayment
Replies: 23
Views: 2231

Re: Taxes on Roth conversion at retirement

Your 401k would have to be pretty small to convert it at a low tax rate in a single year. A 401k worth goggling at would take many years to convert.
by Bob's not my name
Tue Aug 26, 2014 6:22 am
 
Forum: Personal Finance (Not Investing)
Topic: Taxes on Roth conversion at retirement
Replies: 15
Views: 682

Re: MAGI too high for Roth after contributions

I'm surprised you know your MAGI so precisely when you have a large taxable account and year end distributions aren't known yet and a market decline could give you more losses to harvest. In your prior post you said you were $2,000 under the phaseout, and now a pay frequency change is putting you in...
by Bob's not my name
Tue Aug 26, 2014 4:48 am
 
Forum: Investing - Help with Personal Investments
Topic: MAGI too high for Roth after contributions
Replies: 4
Views: 568

Re: Portfolio help please

Something about your numbers doesn't make sense to me. I'm asking about this because maybe you're not as close to the direct Roth phaseout as you think. To put you in the 28% bracket with that mortgage I think your gross income would have to be >$110,000 ... but that means 15% would be pretty close ...
by Bob's not my name
Mon Aug 25, 2014 7:52 pm
 
Forum: Investing - Help with Personal Investments
Topic: Portfolio help please
Replies: 5
Views: 443

Re: Trying to understand the 1040 Tax Table

Certain deductions PHASE OUT through a range of income, so your true marginal rate could be higher (never lower?) than the Table. Besides deduction phaseouts, there are also taxes, tax credits, and exemptions that phase out. Furthermore, these are not based on taxable income, but on other income de...
by Bob's not my name
Mon Aug 25, 2014 3:48 pm
 
Forum: Personal Finance (Not Investing)
Topic: Trying to understand the 1040 Tax Table
Replies: 27
Views: 1614

Re: using the 15% tax bracket

Also consider possible state tax ramifications. ... If you're in the 15% federal bracket your state tax burden can easily be more than a third of your marginal rate on conversions and 100% of your marginal rate on LTCG. State tax treatment of LTCG and IRA conversions varies, with most (but not all)...
by Bob's not my name
Mon Aug 25, 2014 8:00 am
 
Forum: Personal Finance (Not Investing)
Topic: using the 15% tax bracket
Replies: 42
Views: 4270

Re: convince me not to use traditional IRA for house downpay

Try a house today, just for fun, just because everybody's doing it, and before you know it you're mainlining four houses a day. Where does it stop?
by Bob's not my name
Sun Aug 24, 2014 1:40 pm
 
Forum: Personal Finance (Not Investing)
Topic: convince me not to use traditional IRA for house downpayment
Replies: 23
Views: 2231

Re: Need Help: State-Specific Bond Funds and Moving ?

Since the OH fund, Admiral shares of the CA fund of equal duration, and Admiral shares of the nationally diversified fund of equal duration are all yielding the same after adjusting for California taxes, I don't see any urgency in unloading the OH fund. There's no Mann Act for municipal bonds. If th...
by Bob's not my name
Sun Aug 24, 2014 4:47 am
 
Forum: Investing - Help with Personal Investments
Topic: Need Help: State-Specific Bond Funds and Moving ?
Replies: 6
Views: 579

Re: Advice on 401k - Traditional vs Roth

You need to run the math on that. It is not less. The commutative property of multiplication is involved. Also, you may not pay any tax on traditional, at least in some years, and in particular in some of the events you mention. Many states exempt TIRA withdrawals from taxation. As for federal, assi...
by Bob's not my name
Sat Aug 23, 2014 4:09 pm
 
Forum: Investing - Help with Personal Investments
Topic: Advice on 401k - Traditional vs Roth
Replies: 17
Views: 1280

Re: Advice on 401k - Traditional vs Roth

This is a hard question to answer since the ideal choice would be to have a mixture of account types so you will have more options when you are retired. If you are in the 25% or higher federal tax bracket it would take some compelling reasons, which is very possible, to choose a Roth when you could...
by Bob's not my name
Sat Aug 23, 2014 3:57 pm
 
Forum: Investing - Help with Personal Investments
Topic: Advice on 401k - Traditional vs Roth
Replies: 17
Views: 1280

Re: using the 15% tax bracket

I've done it with brokered CDs on the one hand and stock funds on the other. Recharacterized the CDs IRA and reconverted in the next tax year. This was for a wealthy elderly person with headroom in the 0% bracket.
by Bob's not my name
Sat Aug 23, 2014 2:32 pm
 
Forum: Personal Finance (Not Investing)
Topic: using the 15% tax bracket
Replies: 42
Views: 4270

Re: convince me not to use traditional IRA for house downpay

The "finite" amount is often more than one can consistently afford. We often assume the saturated case in theory, whereas it is rare in real life (less rare among bogleheads, sure, but still uncommon). Many people have enough tax-advantaged space to be saving a third of their gross income....
by Bob's not my name
Sat Aug 23, 2014 9:41 am
 
Forum: Personal Finance (Not Investing)
Topic: convince me not to use traditional IRA for house downpayment
Replies: 23
Views: 2231

Re: using the 15% tax bracket

Also consider possible state tax ramifications. Yes. If you're in the 15% federal bracket your state tax burden can easily be more than a third of your marginal rate on conversions and 100% of your marginal rate on LTCG. State tax treatment of LTCG and IRA conversions varies, with most (but not all...
by Bob's not my name
Sat Aug 23, 2014 7:09 am
 
Forum: Personal Finance (Not Investing)
Topic: using the 15% tax bracket
Replies: 42
Views: 4270

Re: Question on spousal ROTH IRA backdoor

That makes more sense. "Income" doesn't mean salary. The Roth and spousal deductible TIRA phaseouts are both $181,000 - $191,000 MAGI, so around $210,000 gross income.
by Bob's not my name
Fri Aug 22, 2014 8:46 pm
 
Forum: Personal Finance (Not Investing)
Topic: Question on spousal ROTH IRA backdoor
Replies: 7
Views: 550

Re: Question on spousal ROTH IRA backdoor

walletless wrote:Current Income:
- ~$165,000 annually
Something wrong here.

You are eligible for a direct Roth IRA. Your wife is eligible for a deductible spousal TIRA. You are not in the 33% bracket. You shouldn't be in the AMT. Is this a typo?
by Bob's not my name
Fri Aug 22, 2014 8:28 pm
 
Forum: Personal Finance (Not Investing)
Topic: Question on spousal ROTH IRA backdoor
Replies: 7
Views: 550

Re: convince me not to use traditional IRA for house downpay

So 28% federal and 0% Illinois because IL doesn't tax IRA withdrawals, regardless of age, right? I don't see why you'd choose to pay 28% tax rather than draw from taxable or Roth. If the "rainy day" is one of the many cases for a penalty-free TIRA withdrawal, I don't see why you wouldn't u...
by Bob's not my name
Fri Aug 22, 2014 8:16 am
 
Forum: Personal Finance (Not Investing)
Topic: convince me not to use traditional IRA for house downpayment
Replies: 23
Views: 2231

Re: Advice on 401k - Traditional vs Roth

Since you're young and single your marginal tax rate is probably high, so you should very probably be maxing your traditional 401k ($17,500 in 2014) and then contributing to a Roth IRA if you can afford to save more.
by Bob's not my name
Thu Aug 21, 2014 8:14 pm
 
Forum: Investing - Help with Personal Investments
Topic: Advice on 401k - Traditional vs Roth
Replies: 17
Views: 1280

Re: Roth Conversion - Old Age

You have to enter real numbers into any model or tax software to get useful guidance, and we don't know what those numbers are. As House Blend pointed out, their real income (including investment income on the $120,000) may place them in a 28% bracket for Roth conversions. And the wife would pay unn...
by Bob's not my name
Wed Aug 20, 2014 10:11 am
 
Forum: Investing - Help with Personal Investments
Topic: Roth Conversion - Old Age
Replies: 31
Views: 1179

Re: Move all bonds to Roth IRA?

You can withdraw Roth IRA contributions (but not earnings) at any time for any reason, penalty-free. No five years. You can withdraw $10,000 from a TIRA, penalty-free, for a first home purchase. You wouldn't want to do either, because you are short on tax-advantaged space. The math on Roth vs. TIRA ...
by Bob's not my name
Wed Aug 20, 2014 5:11 am
 
Forum: Investing - Help with Personal Investments
Topic: Move all bonds to Roth IRA?
Replies: 13
Views: 1564

Re: 401k versus Roth IRA

Thanks for that clarification. You know that AGI and taxable income are completely different things, right? Anyway, you're in the 30% bracket, so go 401k.
by Bob's not my name
Tue Aug 19, 2014 9:18 pm
 
Forum: Investing - Help with Personal Investments
Topic: 401k versus Roth IRA
Replies: 15
Views: 675

Re: Roth Conversion - Old Age

MDisciple87 wrote:Her Pension: $480
His Pension: $1,893
Gross or net after withholding?
by Bob's not my name
Tue Aug 19, 2014 8:56 pm
 
Forum: Investing - Help with Personal Investments
Topic: Roth Conversion - Old Age
Replies: 31
Views: 1179

Re: 401k versus Roth IRA

1 dependent infant Tax Rate: 25% Federal (118k taxable last year for HH) It looks like you're above the child tax credit phaseout (AGI $110,000 - $130,000 for one kid), but pay attention to that, because your marginal rate is 30% in the phaseout, which makes 401k contributions even more attractive....
by Bob's not my name
Tue Aug 19, 2014 8:55 pm
 
Forum: Investing - Help with Personal Investments
Topic: 401k versus Roth IRA
Replies: 15
Views: 675

Re: Roth Conversion - Old Age

Thanks very much for that. Here's what (little) I know about Michigan, but I'm not a Michigan taxpayer and I'm not going to look it up: Michigan (4.25%, 6.75% in Detroit) had a $90,000 exemption for taxpayers over 59.5, but in 2012 that was reduced to $40,000 and the age requirement was raised to 67...
by Bob's not my name
Tue Aug 19, 2014 4:52 pm
 
Forum: Investing - Help with Personal Investments
Topic: Roth Conversion - Old Age
Replies: 31
Views: 1179

Re: Roth Conversion - Old Age

Modest at 30% tax rate is still 30% tax rate. Why would a person of modest means voluntarily pay tax at that rate?

Taxcaster 2025 isn't available yet.
by Bob's not my name
Tue Aug 19, 2014 4:32 pm
 
Forum: Investing - Help with Personal Investments
Topic: Roth Conversion - Old Age
Replies: 31
Views: 1179

Re: Roth Conversion - Old Age

Summary provided shows no taxable holdings with gains, just a bank account. If there were, combining gains with conversions would result in the conversion being taxed at 30%, plus state tax for him if over the exemption amount and for her regardless of amount. Since there aren't, I think (and, again...
by Bob's not my name
Tue Aug 19, 2014 4:13 pm
 
Forum: Investing - Help with Personal Investments
Topic: Roth Conversion - Old Age
Replies: 31
Views: 1179

Re: Roth Conversion - Old Age

I'm not an expert on Social Security taxation, but you probably want to become one. The wiki indicates to me a conversion would be taxed at a higher rate. Be sure to look at Michigan tax as well -- there are key exemption requirements there.
by Bob's not my name
Tue Aug 19, 2014 3:37 pm
 
Forum: Investing - Help with Personal Investments
Topic: Roth Conversion - Old Age
Replies: 31
Views: 1179

Re: Roth Conversion - Old Age

Yeah, I caught that error myself. Doh.
by Bob's not my name
Tue Aug 19, 2014 3:29 pm
 
Forum: Investing - Help with Personal Investments
Topic: Roth Conversion - Old Age
Replies: 31
Views: 1179

Re: Roth Conversion - Old Age

Their marginal rate on a conversion would not be 15%.
by Bob's not my name
Tue Aug 19, 2014 3:26 pm
 
Forum: Investing - Help with Personal Investments
Topic: Roth Conversion - Old Age
Replies: 31
Views: 1179

Re: Roth Conversion - Old Age

It's definitely not old age and they don't have so much money that they can be sure they won't need it all to pay for long-term care later. Therefore voluntarily paying any tax may not be a good idea. At the very least it requires careful study. When your federal rate is 15% your state tax is an imp...
by Bob's not my name
Tue Aug 19, 2014 3:19 pm
 
Forum: Investing - Help with Personal Investments
Topic: Roth Conversion - Old Age
Replies: 31
Views: 1179

Re: Asset Allocation 50 yr old couple too much taxable cash.

$23,000 once you're 50. You had the right maxes for the SIMPLE and Roths but not for the 403b. More tax-advantaged space :D Also, make sure the kid doesn't pay the final tuition bill before Jan 1 of graduation year (that is, whichever calendar year marks the end of graduate school). Most universitie...
by Bob's not my name
Sun Aug 17, 2014 2:02 pm
 
Forum: Investing - Help with Personal Investments
Topic: Asset Allocation 50 yr old couple too much taxable cash.
Replies: 9
Views: 737

Re: Asset Allocation 50 yr old couple too much taxable cash.

I suggest maxing her 403b with another $5,500. I also suggest managing tuition payments so you can get the American Opportunity Tax Credit, if you're eligible -- I don't know if this makes sense vs. paying entirely out of the 529, but it's worth considering, since it's a $2,500 credit.
by Bob's not my name
Sun Aug 17, 2014 1:50 pm
 
Forum: Investing - Help with Personal Investments
Topic: Asset Allocation 50 yr old couple too much taxable cash.
Replies: 9
Views: 737

Re: Gift Tax and Gifting to child.

I see two immediate problems: 1) Misunderstanding of the gift tax, which is not income tax. 2) I don't think $1.5M is too much for a 68-year-old to have. Long term nursing care can consume all that. So I suggest education on the gift tax. Hopefully that will take your parent about thirty years. I'm ...
by Bob's not my name
Sun Aug 17, 2014 1:47 pm
 
Forum: Investing - Help with Personal Investments
Topic: Gift Tax and Gifting to child.
Replies: 2
Views: 266

Re: Should I Invest in both T-IRA & R-IRA?

Right, and he may have a little more headroom in the 15% bracket because with his mortgage and high state tax he probably itemizes. Also, I've been assuming throughout that he doesn't have pre-tax health, dental, or disability insurance premiums or FSA contributions withheld from his pay or his wife...
by Bob's not my name
Sat Aug 16, 2014 1:32 pm
 
Forum: Investing - Help with Personal Investments
Topic: Should I Invest in both T-IRA & R-IRA?
Replies: 34
Views: 1285

Re: Should I Invest in both T-IRA & R-IRA?

Start by reading your own tax return, line by line, to get the picture. The form and instructions are designed for a step-by-step zombie walk rather than to reveal to you how you're being taxed, so it takes a little studying to figure our how each line is really affecting you.
by Bob's not my name
Sat Aug 16, 2014 1:02 pm
 
Forum: Investing - Help with Personal Investments
Topic: Should I Invest in both T-IRA & R-IRA?
Replies: 34
Views: 1285

Re: Should I Invest in both T-IRA & R-IRA?

$95,000 gross income has you in the 15% bracket already. As I explained in my first post, if your gross income exceeds $110,000 and you make NO pre-tax retirement contributions, you will be in the 25% federal bracket, the 7% state bracket, and the child tax credit phaseout. The $1,000 credit phases ...
by Bob's not my name
Sat Aug 16, 2014 12:48 pm
 
Forum: Investing - Help with Personal Investments
Topic: Should I Invest in both T-IRA & R-IRA?
Replies: 34
Views: 1285

Re: Should I Invest in both T-IRA & R-IRA?

$73,800 taxable income = 2014 top of 15% bracket + $12,400 standard deduction + $7,900 two personal exemptions + $2,400 special deduction for 65-and-over crowd because they're so special -------------- $96,500 gross income Why your current rate is probably 35% is explained in my first post in this t...
by Bob's not my name
Sat Aug 16, 2014 11:21 am
 
Forum: Investing - Help with Personal Investments
Topic: Should I Invest in both T-IRA & R-IRA?
Replies: 34
Views: 1285

Re: Should I Invest in both T-IRA & R-IRA?

Our income at 70.5 should be roughly $85,000, give or take a few thousand. If this is ultimately the case, I should stay in the 25% bracket in retirement. Why? That's more than $10,000 below the current 25% bracket for a couple over 65 with no dependents, and way below what it will be when you're r...
by Bob's not my name
Sat Aug 16, 2014 11:05 am
 
Forum: Investing - Help with Personal Investments
Topic: Should I Invest in both T-IRA & R-IRA?
Replies: 34
Views: 1285

Re: Should I Invest in both T-IRA & R-IRA?

It's not very likely that you exceed the income limit, on a military income, for your wife to make deductible contributions to a traditional IRA. The phaseout starts at $181,000 AGI for a spouse not covered by an employer plan. Your own eligibility starts phasing out at $96,000 AGI. AGI is reduced b...
by Bob's not my name
Fri Aug 15, 2014 8:53 pm
 
Forum: Investing - Help with Personal Investments
Topic: Should I Invest in both T-IRA & R-IRA?
Replies: 34
Views: 1285

Re: Converting an inherited Roth IRA to a regular Roth IRA

How Lazarus Rushed a Fraternity would be catchier.
by Bob's not my name
Thu Aug 14, 2014 10:33 am
 
Forum: Personal Finance (Not Investing)
Topic: Converting an inherited Roth IRA to a regular Roth IRA
Replies: 11
Views: 675
Next

Return to advanced search