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Re: Roth IRA phase out calculator

Do you know why you got a difference? Was it because you were using different MAGI (modified adjusted gross income) for Roth purposes? Was it because the upper and lower income limits for the phase out range were different in the different calculators? If you can narrow it down it's easier to figure...
by Epsilon Delta
Sat Jan 24, 2015 6:49 pm
 
Forum: Personal Finance (Not Investing)
Topic: Roth IRA phase out calculator
Replies: 7
Views: 646

Re: Factors and zero-sum investing

... In an efficient market, does it make sense to believe that you will be on the right side of the zero sum game, whatever strategy you follow, and that there will be investors on the other side are collectively dumber than you are? It seems unlikely. Perhaps this was the part of the argument Alex...
by Epsilon Delta
Sat Jan 24, 2015 12:10 am
 
Forum: Investing - Theory, News & General
Topic: Factors and zero-sum investing
Replies: 57
Views: 2728

Re: Google Chrome: is this a mega security problem?

I still hold to my original view. In contrast to what you are saying, this browser sync is NOT a brand new functionality. It has been around for at least a year now, and millions upon millions of people have used it without problem. I do strongly feel that widespread common use without failures it ...
by Epsilon Delta
Fri Jan 23, 2015 5:17 pm
 
Forum: Personal Consumer Issues
Topic: Google Chrome: is this a mega security problem?
Replies: 111
Views: 6460

Re: What to do w/ .2c intrest credited after doing backdoor

Also what does below mean? VG Brokerage accounts more (relatively) safer than non-Brokerage (Mutual fund?) accounts? Vanguard funds not held in a brokerage account are held by The Vanguard Group, Inc. and are not protected by SIPC. This has been covered before, since this is a large topic and not d...
by Epsilon Delta
Fri Jan 23, 2015 12:53 pm
 
Forum: Investing - Help with Personal Investments
Topic: What to do w/ 2¢ interest credited after doing backdoor Roth
Replies: 9
Views: 1214

Re: What to do w/ .2c intrest credited after doing backdoor

2) Leave 0.02cents as it as and during next year conversion, convert the new $5500+0.02cents. Just want to be sure this trailing 0.02cents from this year will not cause any issues while converting the next year's contribution. I'll inject my 2¢. This ↑ is what I'd do. It does not matter what you do...
by Epsilon Delta
Fri Jan 23, 2015 12:01 pm
 
Forum: Investing - Help with Personal Investments
Topic: What to do w/ 2¢ interest credited after doing backdoor Roth
Replies: 9
Views: 1214

Re: Intuit Turbo Tax Refund

They really don't get it or are really sinister. How anyone on their planning committee could not see the uproar is a puzzlement. I'd go with cynical. The job of the planning committee is to maximize profits. I'd say the planning committee saw the uproar but doesn't think it matters. They've been r...
by Epsilon Delta
Fri Jan 23, 2015 11:46 am
 
Forum: Personal Finance (Not Investing)
Topic: Intuit Turbo Tax Refund
Replies: 23
Views: 2108

Re:

I wonder then, could most important paper documents be scanned and stored? What documents need to be kept and protected safely enough to require a deposit box or safe that a scanned version wouldn't be just as well from a legal perspective? I'm curious since I'm much more diligent about protecting ...
by Epsilon Delta
Fri Jan 23, 2015 11:19 am
 
Forum: Personal Consumer Issues
Topic: Anti-theft Fire Waterproof Safe
Replies: 16
Views: 1978

Re: Diversity b/t t-IRA and roth-IRA

I put stocks in my Roth. I do this because I think stocks are expected to do better, but have a higher risk.* This interacts with progressive tax rates. If I put the stocks in the tIRA then if the stocks do badly I will pay low taxes, while if the stocks do well I will pay at a higher rate. If I put...
by Epsilon Delta
Fri Jan 23, 2015 10:50 am
 
Forum: Investing - Help with Personal Investments
Topic: Diversity b/t t-IRA and roth-IRA
Replies: 8
Views: 530

Re: Netflix DVD delivery slowdown?

Some of the changes of location may be due to closing USPS facilities. If I mail a letter to my neighbor it used to go to a sorting facility 5 miles away. Now it goes to one 100 miles away. Local mail takes a 200 mile round trip. In contrast mail to a point near the new facility is a 100 mile trip. ...
by Epsilon Delta
Fri Jan 23, 2015 10:32 am
 
Forum: Personal Consumer Issues
Topic: Netflix DVD delivery slowdown?
Replies: 37
Views: 3097

Re: 1099-R from Mega Backdoor Roth IRA

Thank you Alan.
by Epsilon Delta
Thu Jan 22, 2015 10:22 pm
 
Forum: Personal Finance (Not Investing)
Topic: 1099-R from Mega Backdoor Roth IRA
Replies: 6
Views: 800

Re: Bid ask spreads - larger after market closes?

And if you think anybody knew that when it was possible to act on it I've got a bridge to sell. If you are requiring 100% certainty, then I agree with you. For folks who do not require 100% certainty, I thought there was an opportunity today, so I took it. No you don't need certainty, but after any...
by Epsilon Delta
Thu Jan 22, 2015 9:13 pm
 
Forum: Investing - Help with Personal Investments
Topic: Bid ask spreads - larger after market closes?
Replies: 11
Views: 453

Re: 1099-R from Mega Backdoor Roth IRA

How is the 401(k) custodian supposed to know that the money was rolled over to a Roth? All the custodian does is send a check made out the "Vanguard FBO Epsilon Delta" I could deposit it in either a Roth or traditional without the 401(k) custodian knowing.
by Epsilon Delta
Thu Jan 22, 2015 8:47 pm
 
Forum: Personal Finance (Not Investing)
Topic: 1099-R from Mega Backdoor Roth IRA
Replies: 6
Views: 800

Re: Bid ask spreads - larger after market closes?

Kinda makes mutual funds seem preferable again (at least admiral shares) Except today you could've bought VTI 1.8% cheaper than you could buy VTSAX. This is why ETFs can sometimes be great! In a day or so, that 1.8% cheaper possiblity will not show up in any of the data available such as Morningsta...
by Epsilon Delta
Thu Jan 22, 2015 8:19 pm
 
Forum: Investing - Help with Personal Investments
Topic: Bid ask spreads - larger after market closes?
Replies: 11
Views: 453

Re: when did Backdoor Roth first become available?

At the start of the Roth in 1998 the conversion limit was $100,000 for all tax payers, while for single and head of household the contribution phase out was $95,000 - $110,000. So for a very few tax payers the backdoor Roth existed right from the beginning.
by Epsilon Delta
Thu Jan 22, 2015 7:55 pm
 
Forum: Investing - Theory, News & General
Topic: when did Backdoor Roth first become available?
Replies: 6
Views: 987

Re: Why are people buying 10 year Bunds?

Can't Germans hedge their currency exposure? To the first order the cost of hedging is the difference in the interest rates for risk-less assets in the two currencies. If this were exact it would mean hedged Treasuries would yield the same as Bunds. There are second order effects, so you'd have to ...
by Epsilon Delta
Thu Jan 22, 2015 7:34 pm
 
Forum: Investing - Theory, News & General
Topic: Why are people buying 10 year Bunds?
Replies: 14
Views: 1372

Re: HSA... any receipt savers?

I know someone who had an HSA, didn't tap into it, and later got a different health insurance plan with no HSA. So now he has money sitting in an HSA, but now he gets to use an FSA (flex spending) for his ongoing expenses. At some point, he's going to have to tell the IRS, "Here's a $1000 expe...
by Epsilon Delta
Thu Jan 22, 2015 4:14 pm
 
Forum: Investing - Help with Personal Investments
Topic: HSA... any receipt savers?
Replies: 147
Views: 5750

Re: Help on Converting Traditional IRA into Roth IRA

Thank you for your kind reply, Epsilon. The 02/20/2014 contribution $5,500 are non deductible. And since I converted the contribution on 2/21/2014 immediately, there was no capital gain, so the full $5,500 are non-taxable ? I thought that's the way backdoor roth IRA works. Therefore, the $9,595 wil...
by Epsilon Delta
Thu Jan 22, 2015 3:58 pm
 
Forum: Investing - Help with Personal Investments
Topic: Help on Converting Traditional IRA into Roth IRA
Replies: 10
Views: 428

Re: Why are people buying 10 year Bunds?

Treasuries carry currency risk for people in Eurozone countries. Can't Germans hedge their currency exposure? To the first order the cost of hedging is the difference in the interest rates for risk-less assets in the two currencies. If this were exact it would mean hedged Treasuries would yield the...
by Epsilon Delta
Thu Jan 22, 2015 3:34 pm
 
Forum: Investing - Theory, News & General
Topic: Why are people buying 10 year Bunds?
Replies: 14
Views: 1372

Re: Help on Converting Traditional IRA into Roth IRA

Hi everyone, Can you help me understand the tax consequence of converting a traditional IRA into a Roth IRA? On 2/20/2014, I opened a Traditional IRA at Vanguard with $5,500 purchase. The next day I immediately converted the fund into a Roth IRA. So the balance of traditional IRA was zero. On 6/25/...
by Epsilon Delta
Thu Jan 22, 2015 3:16 pm
 
Forum: Investing - Help with Personal Investments
Topic: Help on Converting Traditional IRA into Roth IRA
Replies: 10
Views: 428

Re: Surviving the Tax Bite of RMD Withdrawals in Retirement

When taking RMD's, I have seen little discussion about making adjustments year by year to smooth out one's tax obligation. One would think that a 75-80 year old in good health would anticipate the tax consequences of RMD withdrawals 5 to 10 years in the future and would perhaps withdraw more than t...
by Epsilon Delta
Thu Jan 22, 2015 2:35 pm
 
Forum: Investing - Theory, News & General
Topic: Surviving the Tax Bite of RMD Withdrawals in Retirement
Replies: 75
Views: 5880

Re: HSA... any receipt savers?

I would never keep paper only, no matter what the historic precedence is; it can fade, burn, get misplaced. That said, I would also never rely only on scans. They are easily faked. Walking into an audit without a single scrap of paper to back up your claims is just asking for trouble, in my view. I...
by Epsilon Delta
Thu Jan 22, 2015 12:34 pm
 
Forum: Investing - Help with Personal Investments
Topic: HSA... any receipt savers?
Replies: 147
Views: 5750

Re: HSA... any receipt savers?

IMO, That sounds very onerous, like "Unfair Burden", i.e. proving a negative. It's proof in the legal sense, not the mathematical sense. What you have to do is provide evidence up to some particular standard (somewhere between "balance of probabilities" and "beyond reasonab...
by Epsilon Delta
Thu Jan 22, 2015 11:12 am
 
Forum: Investing - Help with Personal Investments
Topic: HSA... any receipt savers?
Replies: 147
Views: 5750

Re: HSA... any receipt savers?

From Pub 969 http://www.irs.gov/pub/irs-pdf/p969.pdf ... "The medical expenses had not been taken as an itemized deduction in any year."... If I intend to keep receipts for longer than 7 years (and I do), I should probably keep tax records too ... :/ Medical expenses can only be deducted ...
by Epsilon Delta
Thu Jan 22, 2015 10:55 am
 
Forum: Investing - Help with Personal Investments
Topic: HSA... any receipt savers?
Replies: 147
Views: 5750

Re: Netflix DVD delivery slowdown?

USPS is known to be reducing next day deliveries. Is the rest of your mail taking longer?
by Epsilon Delta
Wed Jan 21, 2015 4:55 pm
 
Forum: Personal Consumer Issues
Topic: Netflix DVD delivery slowdown?
Replies: 37
Views: 3097

Re: Roth IRA Over-Contribution

Thank you for your help, Epsilon. I do not have any other IRAs, just the one Roth IRA which I have contributed to in previous years and a Traditional 401K. So it sounds like I am fine to do both the recharacterization and conversion prior to filing my taxes this year. The only wrinkle is that I wil...
by Epsilon Delta
Wed Jan 21, 2015 2:24 pm
 
Forum: Personal Finance (Not Investing)
Topic: Roth IRA Over-Contribution
Replies: 4
Views: 266

Re: What will happen to international stocks if a Euro break

P.S. Meanwhile, the world is a big place, and "Europe developed" and "Europe emerging" stocks are slightly less than 1/3 of Vanguard Total International. Hopefully you are not holding VEURX as your only international holding? Even Europe is a big place. Less than half of VEURX i...
by Epsilon Delta
Wed Jan 21, 2015 2:00 pm
 
Forum: Investing - Theory, News & General
Topic: What will happen to international stocks if a Euro breakup?
Replies: 23
Views: 1561

Re: Roth IRA Over-Contribution

In early 2014 I contributed $5,500 to my Roth IRA via TD Ameritrade. An unexpected raise and bonus has pushed my AGI for the year over contribution and phase-out limits so I beleive I need to recharacterize this contribution to a Traditional IRA to avoid penalty. I have found the necessary forms to...
by Epsilon Delta
Wed Jan 21, 2015 1:50 pm
 
Forum: Personal Finance (Not Investing)
Topic: Roth IRA Over-Contribution
Replies: 4
Views: 266

Re: What if I incorrectly fund my IRA/401k?

Yes, VG (or any other custodian) will let you open the TIRA, or any Roth IRA you need as well. Whatever your investment gains, particularly small amounts, you would convert the entire balance and pay tax only on the gains. If your contribution lost money, then you can only convert what is there and...
by Epsilon Delta
Wed Jan 21, 2015 12:24 pm
 
Forum: Personal Finance (Not Investing)
Topic: What if I incorrectly fund my IRA/401k?
Replies: 18
Views: 1605

Re: $7 gas - what would you do?

I would keep riding my bike 1.4 miles to work, as I have for 20 months since selling our car. Renting our parking spot at the rate we get this close to city center might get harder, though. Maybe you could rent it to somebody who wants to pitch a tent because they can no longer afford to commute to...
by Epsilon Delta
Wed Jan 21, 2015 12:10 pm
 
Forum: Personal Consumer Issues
Topic: $7 gas - what would you do?
Replies: 125
Views: 18557

Re: One per year IRA Rollover & Mega backdoor Roth

Also note that the once per year rule only applies if you get your grubby hands on the filthy lucre. You can do as many custodian to custodian transfers of any type as you like.
by Epsilon Delta
Wed Jan 21, 2015 12:05 pm
 
Forum: Investing - Theory, News & General
Topic: One per year IRA Rollover & Mega backdoor Roth
Replies: 3
Views: 387

Re: Withdrawing Backdoor Money from Roth IRA

There are also two separate 5-year (tax years, not calendar years) waiting periods before your contributions become qualified. Before that waiting period is over, withdrawals on non-qualified contributions pay the 10% early-withdrawal penalty as well. Here are the two 5-year waiting periods: (https...
by Epsilon Delta
Wed Jan 21, 2015 11:55 am
 
Forum: Investing - Theory, News & General
Topic: Withdrawing Backdoor Conversions from Roth IRA
Replies: 30
Views: 1950

Re: Withdrawing Backdoor Money from Roth IRA

I'm not sure what you don't understand. You have the ordering rules correct.* (1) Regular contributions (2) Taxable portion of first conversion (3) Nontaxable portion of first conversion (4) Each subsequent conversion, in order, with the taxable portion coming out first for each conversion (5) Earni...
by Epsilon Delta
Wed Jan 21, 2015 11:38 am
 
Forum: Investing - Theory, News & General
Topic: Withdrawing Backdoor Conversions from Roth IRA
Replies: 30
Views: 1950

Re: Adjusted Livesoft Income (ALI)

Much ink has been spilt on this subject. Economists have a theory of imputed income , that does attribute income to a paid off asset such as a house. I don't believe there is a reasonable person who doubts that a paid off house has value, although there are differences on how to account for it. Ther...
by Epsilon Delta
Wed Jan 21, 2015 9:29 am
 
Forum: Personal Finance (Not Investing)
Topic: Adjusted Livesoft Income (ALI)
Replies: 31
Views: 3019

Re: Adjusted Livesoft Income (ALI)

Also you may want to look at some of the credits, at least the refundable ones such as EIC, child tax credit, net premium tax credit (tricky) and excess SS taxes.
by Epsilon Delta
Tue Jan 20, 2015 8:13 pm
 
Forum: Personal Finance (Not Investing)
Topic: Adjusted Livesoft Income (ALI)
Replies: 31
Views: 3019

Re: Adjusted Livesoft Income (ALI)

Clearly the adjustments to income should be considered for adding back. Lines 25 (HSA deduction), 28 (SIMPLE etc), 29 (health insurance) and 32 (IRA) are analogous to things you are adding back for W-2 employees. Where ever you write in FEIE should also be there. The rest of the adjustments you can ...
by Epsilon Delta
Tue Jan 20, 2015 8:08 pm
 
Forum: Personal Finance (Not Investing)
Topic: Adjusted Livesoft Income (ALI)
Replies: 31
Views: 3019

Re: Did the Swiss stock market really lose 9%?

technovelist wrote:No, you are correct. However, I don't think that would make Swiss investors feel much better. :moneybag


But they can all take a vacation in the Riviera at 20% off. That should be some consolation.
by Epsilon Delta
Tue Jan 20, 2015 1:06 pm
 
Forum: Investing - Theory, News & General
Topic: Did the Swiss stock market really lose 9%?
Replies: 15
Views: 2178

Re: Tax Loss Harvesting Form ?

Vanguard is having a big problem with their 1099s so far this year. Probably some heads will roll about their mistakes. I would be surprised if your 1099s are correct and complete at this time. We have no evidence for this statement. What we do have evidence for is that some people don't understand...
by Epsilon Delta
Tue Jan 20, 2015 1:04 pm
 
Forum: Personal Finance (Not Investing)
Topic: Tax Loss Harvesting Form ?
Replies: 7
Views: 489

Re: backdoor roth when under AGI limit

He said go ahead and fund the traditional and then covert to Roth, and it wouldn't matter if I was under or over the MAGI limit for 2015. If you find you are under the MAGI limit, consider a recharacterization to Roth instead of a conversion. If you convert, you will pay taxes on the gains. If you ...
by Epsilon Delta
Tue Jan 20, 2015 12:50 pm
 
Forum: Investing - Help with Personal Investments
Topic: backdoor roth when under AGI limit
Replies: 16
Views: 1177

Re: First backdoor Roth. Very simple question...I think

You'll want to convert the total. You will have to pay taxes and possibly penalties on the $73, not a big deal IMO. Thanks barnaclebob! I really appreciate the help. The penalties I can deal with. I will learn my lesson to do the process quicker next time and utilize a money market (if there is a n...
by Epsilon Delta
Tue Jan 20, 2015 12:35 pm
 
Forum: Investing - Help with Personal Investments
Topic: First backdoor Roth. Very simple question...I think
Replies: 5
Views: 358

Re: Which of 7 cost-basis methods? (Poll)

Average works ok for those who are willing to pay more tax than necessary and unwilling to learn about the alternatives. Specific ID for everyone else. Edit : LGUT fails when you are donating shares. There, what you want are the lowest cost long-term shares. Another failure mode: tax gain harvestin...
by Epsilon Delta
Tue Jan 20, 2015 12:28 pm
 
Forum: Investing - Theory, News & General
Topic: Which of 7 cost-basis methods? (Poll)
Replies: 11
Views: 871

Re: downhill ski boots question

Is it worth investing in decent boots that I take with me wherever we ski? We mostly ski Mt Hood, so a mix of fluffy snow as well as Cascade Concrete and sometimes downright rain, but at the same time my sister is in Utah so typically very light snow, point being I'm not sure I'm ready to commit to...
by Epsilon Delta
Tue Jan 20, 2015 12:15 pm
 
Forum: Personal Consumer Issues
Topic: downhill ski boots question
Replies: 17
Views: 1000

Re: Google Chrome: is this a mega security problem?

The issue is not whether to use or not to use certain features, but to know which features are activated by default and the implications of these features. If you decide on your own to use the cloud, you investigate various offerings, including their features and constraints, and then you make your...
by Epsilon Delta
Tue Jan 20, 2015 11:50 am
 
Forum: Personal Consumer Issues
Topic: Google Chrome: is this a mega security problem?
Replies: 111
Views: 6460

Re: Honda Civic vs Fit Safety Question

When buying new, frontal crash avoidance (not just warning) and adaptive headlights are showing up as most important in insurance loss data. I may be parsing too closely, but it would be interesting to look at the types of accidents frontal crash avoidance prevents and ameliorates. Preventing a low...
by Epsilon Delta
Tue Jan 20, 2015 11:27 am
 
Forum: Personal Consumer Issues
Topic: Honda Civic vs Fit Safety Question
Replies: 55
Views: 3307

Re: 1099-DIV error(?)

Called VG this a.m. They said that the missing capital gains information (missing intentionally?) will appear on a consolidated 1099 form that the brokerage will send out in February. When you get the brokerage 1099 make sure you check the time period it covers. It probably won't include dividends ...
by Epsilon Delta
Tue Jan 20, 2015 11:11 am
 
Forum: Investing - Help with Personal Investments
Topic: 1099-DIV error(?)
Replies: 14
Views: 1450

Re: Setting price limit for ETF

All this to invest less that $3,000? And go through the same thing every time you buy more? The alternative is to save for a few more weeks, or years, and buy the mutual fund. In the long term a couple of thousand bucks out of the market for a year is going to be an expected difference of less than ...
by Epsilon Delta
Tue Jan 20, 2015 11:04 am
 
Forum: Investing - Help with Personal Investments
Topic: Setting price limit for ETF
Replies: 22
Views: 1197

Re: Florida in the summer

I don't consider temperatures up to 82 degrees as too-hot-and-to-be-avoided, and your chart seems to confirm my earlier statement that Washington, DC, is mostly fine in summer, except a couple weeks. If the same is true for Orlando, it's great for those living in Orlando and a useful contribution t...
by Epsilon Delta
Tue Jan 20, 2015 10:46 am
 
Forum: Personal Consumer Issues
Topic: Florida in the summer
Replies: 81
Views: 5465

Re: Figuring out early withdrawal penalty on SEP-IRA

Close. You will pay the 10% penalty and ordinary income tax. If you are already in the 25% tax bracket then some of the extra $100,000 will be in the 28% or even 33% bracket.
by Epsilon Delta
Tue Jan 20, 2015 10:03 am
 
Forum: Investing - Help with Personal Investments
Topic: Figuring out early withdrawal penalty on SEP-IRA
Replies: 4
Views: 293

Re: Withdrawing Backdoor Money from Roth IRA

I believe you have a sound understanding. However two things you did not mention. 1) The taxable part of each conversion is only the excess of the conversion over the non-deductible contribution to the traditional IRA, that is the taxable part is the growth between the tIRA contribution and the conv...
by Epsilon Delta
Tue Jan 20, 2015 12:16 am
 
Forum: Investing - Theory, News & General
Topic: Withdrawing Backdoor Conversions from Roth IRA
Replies: 30
Views: 1950

Re: More H&R Block - can't delete 8606 form

At a guess you're joint income is over the limit for taking a deduction.

http://www.irs.gov/Retirement-Plans/IRA ... ion-Limits
by Epsilon Delta
Mon Jan 19, 2015 6:11 pm
 
Forum: Personal Finance (Not Investing)
Topic: More H&R Block - can't delete 8606 form
Replies: 2
Views: 404

Re: calculating tax deferred vs taxable

sorry, I am not being clear. let's say I am at a 35% tax bracket in retirement as well as currently. let's say retirement is 2 years away. It seems that putting VTI in a taxable account is better than a tax deferred account if I am pulling all the money out in year 1 of retirement (as I will pay or...
by Epsilon Delta
Mon Jan 19, 2015 5:35 pm
 
Forum: Investing - Help with Personal Investments
Topic: calculating tax deferred vs taxable
Replies: 11
Views: 600
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