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Re: How to understand tax return

I wish TT or other programs did something like this: Because you donated $100 of goods, your tax liability went down by $29. Because you qualified for the foreign income exclusion, your tax liability went down by $800. The problem is that these things intersect in various ways, so the numbers won't...
by grabiner
Sat Mar 28, 2015 11:08 pm
 
Forum: Personal Finance (Not Investing)
Topic: [Do 457 and extra pension contribs appear on tax return?]
Replies: 5
Views: 522

Re: Turbo Tax keeps prompting me to pay estimated quarterlie

If you owe enough tax this year that you might owe a penalty next year, TurboTax automatically prints out estimated tax forms; it doesn't help you adjust your withholding. (Nor does it help you adjust if you get a big refund, in which case you should probably file a W-4 claiming more allowances.) Yo...
by grabiner
Sat Mar 28, 2015 10:18 pm
 
Forum: Personal Finance (Not Investing)
Topic: Estimated Quarterly Tax FOR VA STATE
Replies: 4
Views: 616

Re: investment allocation for a non-retirement goal

I am not a Californian. Other threads recommend not having all your tax-exempt bonds in one state. The optimum may be 50% California tax-exempt and 50% US tax-exempt. The risk is that something specific to California will occur and cause those bonds to default at a higher rate. Good point. I can do...
by grabiner
Sat Mar 28, 2015 7:52 pm
 
Forum: Investing - Help with Personal Investments
Topic: investment allocation for a non-retirement goal
Replies: 9
Views: 777

Re: Paying for a house, paying off mortgage early

In this situation, you could also get a bridge loan, which is designed for this situation. A bridge loan is a short-term loan against a house you are trying to sell, so that you can buy a new house before you sell the current one. Interest rates on bridge loans tend to be higher than on other mortga...
by grabiner
Sat Mar 28, 2015 7:41 pm
 
Forum: Personal Finance (Not Investing)
Topic: Paying for a house, paying off mortgage early
Replies: 7
Views: 726

Re: Mortgage Debt in Retirement?

Read a book not too long ago that made a convincing case that you should always hold the maximum possible mortgage on any house that you own, even if you have to borrow against the equity. This is unlikely as a general rule. If you would be better off borrowing at mortgage rates to invest, why is t...
by grabiner
Sat Mar 28, 2015 7:36 pm
 
Forum: Personal Finance (Not Investing)
Topic: Mortgage Debt in Retirement?
Replies: 71
Views: 4107

Re: HSA Tax Reporting

Ok, now as I re-read the statute, I wonder if HSAs could be exempted by this paragraph: 77:4-b Interest and Dividend Income of Employee Benefit Plans and Tax Deferred Investments Not Taxable. – Notwithstanding any provisions of RSA 77:4 to the contrary, interest and dividend income received by an e...
by grabiner
Sat Mar 28, 2015 7:23 pm
 
Forum: Personal Finance (Not Investing)
Topic: HSA Tax Reporting
Replies: 10
Views: 1051

Re: Mortgage Debt in Retirement?

Doesn't the interest portion decrease with each house payment and the amount of principal payoff increases with each payment? If so, towards the end of the mortgage, the borrower is paying less interest, more principal, thus slightly more tax on the same income necessary for the house payment? That...
by grabiner
Fri Mar 27, 2015 9:25 pm
 
Forum: Personal Finance (Not Investing)
Topic: Mortgage Debt in Retirement?
Replies: 71
Views: 4107

Re: VFSVX or VSS for International Small Cap?

Leif wrote:Seems like the poll is messed up. Both choices say the same and have the same numbers.


When the forum was upgraded a few years ago, it broke all old polls; this thread was started in 2009.
by grabiner
Fri Mar 27, 2015 9:18 pm
 
Forum: Investing - Help with Personal Investments
Topic: VFSVX or VSS for International Small Cap?
Replies: 69
Views: 17078

Re: HSA Tax Reporting

Three states: AL, CA, and NJ. Make that 4 states: AL, CA, NJ, NH However, NH's 5% Interest and Dividends Tax exempts the first $2400 of interest and dividends from taxation ($4800 for MFJ). Do you have an official source for this? I checked several sites which say that NH and TN do tax dividends an...
by grabiner
Fri Mar 27, 2015 9:17 pm
 
Forum: Personal Finance (Not Investing)
Topic: HSA Tax Reporting
Replies: 10
Views: 1051

Re: HSA question

After 65, are distributions taxed as ordinary income and is there a limit to how much you can withdraw (since 65 is the cut off for receipt/qualified distribution requirement)? After 65, distributions not used for medical expenses are taxed as ordinary income, without penalty. You can still have me...
by grabiner
Fri Mar 27, 2015 8:48 pm
 
Forum: Personal Finance (Not Investing)
Topic: HSA question
Replies: 20
Views: 1675

Re: Why 529 plan makes any sense??

I'm sure I'm missing something obvious here, but I've actually considered continuing to contribute to a 529 despite the fact that my kids are older and I may already be overfunded. My thinking is that even assuming a 10% penalty on earnings, I might still be better off using the Colorado Stable Val...
by grabiner
Fri Mar 27, 2015 8:46 pm
 
Forum: Investing - Help with Personal Investments
Topic: When does a 529 plan make sense to me?
Replies: 194
Views: 8313

Re: HSA Tax Reporting

No Fed reporting required if no distributions taken. You may want to check your state requirements. At least one doesn't recognize HSAs and treats as a normal taxable account. Three states: AL, CA, and NJ. Even if you file a non-resident return with one of these states, you have to report the HSA a...
by grabiner
Thu Mar 26, 2015 9:12 pm
 
Forum: Personal Finance (Not Investing)
Topic: HSA Tax Reporting
Replies: 10
Views: 1051

Re: HSA question

This is incorrect. In order to qualify for tax-free HSA distributions, you must have had allowable medical expenses of at least the amount of the distribution. That's it. There is no requirement whatsoever that those expenses be incurred during a certain tax year or calendar year. The only time-rel...
by grabiner
Thu Mar 26, 2015 9:09 pm
 
Forum: Personal Finance (Not Investing)
Topic: HSA question
Replies: 20
Views: 1675

Re: New all-world Small-Cap multi-factor ETF

It looks interesting as a way to get exposure to international small-cap value, which currently isn't available except in the dividend-weighted DLS and DGS. Still, I'll pass. The 0.6% ratio is effectively a 1% ratio for the international small-cap value portion, if you would otherwise be holding the...
by grabiner
Thu Mar 26, 2015 8:55 pm
 
Forum: Investing - Theory, News & General
Topic: New all-world Small-Cap multi-factor ETF
Replies: 4
Views: 623

Re: Keep Cash in Yuan?

There is no particular reason to keep cash in a foreign currency unless you plan to spend that foreign currency (for example, going on a trip to China); you take the risk that the specific foreign currency will rise or fall against the dollar, and if it falls, you lose purchasing power. If you are c...
by grabiner
Thu Mar 26, 2015 8:47 pm
 
Forum: Investing - Theory, News & General
Topic: Keep Cash in Yuan?
Replies: 10
Views: 1113

Re: Vanguard Expense Ratio Changes

The bond fund ERs certainly seem to move a lot less frequently. I suppose that's probably because the AUM doesn't swing wildly. Also, some Vanguard actively-managed stock funds have incentives as part of the management fee; if the fund outperforms its benchmark, the manager may be rewarded with a s...
by grabiner
Thu Mar 26, 2015 8:44 pm
 
Forum: Investing - Theory, News & General
Topic: Vanguard Expense Ratio Changes
Replies: 5
Views: 1456

Re: Treasuries vs. Treasury Funds?

Buying individual TIPS has an additional complication that you owe tax on the inflation adjustment but don't receive a payment for it. TIPS funds distribute the inflation adjustment as a dividend.
by grabiner
Thu Mar 26, 2015 8:36 pm
 
Forum: Investing - Help with Personal Investments
Topic: Treasuries vs. Treasury Funds?
Replies: 6
Views: 762

Re: HSA deadline for tax deduction eligibility

I called up Anthem to verify and I was told that the May to January plan was officially labeled HSA compatible but the January to May one (with the 5600 deductible) was not. I asked if the one that wasn't labeled HSA compatible was still considered an HDHP by the IRS's rules and the agent had no id...
by grabiner
Thu Mar 26, 2015 8:22 pm
 
Forum: Investing - Help with Personal Investments
Topic: HSA deadline for tax deduction eligibility
Replies: 10
Views: 638

Re: Can you really know your AA until you've hit a bear mark

I agree with the advice here. Whenever a poster asks for advice on an all-stock portfolio, I always ask, "How much stock did you have in 2008?" If the answer is 80% of a non-trivial portfolio, then he knows how he reacted to losing half his investments, and 100% stock may be right. For me,...
by grabiner
Thu Mar 26, 2015 8:19 pm
 
Forum: Investing - Help with Personal Investments
Topic: Can you really know your AA until you've hit a bear market?
Replies: 70
Views: 4743

Re: Why 529 plan makes any sense??

The money that I earn is used in the following order: 1. For food, clothing and shelter today. 2. Fund 401K upto the match. 3. Fund Roth IRA or backdoor Roth. 4. Fund balance of the 401K. 5. Fund HSA (as stealth IRA) 6. Fund 529 ac to the extent of the state tax exemption. 7. Fund 457 B plan. (My 4...
by grabiner
Thu Mar 26, 2015 8:14 pm
 
Forum: Investing - Help with Personal Investments
Topic: When does a 529 plan make sense to me?
Replies: 194
Views: 8313

Re: Total International Stock Index includes small caps or n

I still do not understand why Vanguard manages the two funds anymore and does not merge them. While the names are confusing, the pair makes sense. In US stocks, Vanguard has a Large-Cap Index, a Small-Cap Index, and a Total Stock Market Index which includes both. Similarly, in foreign stocks, Vangu...
by grabiner
Wed Mar 25, 2015 8:31 pm
 
Forum: Investing - Theory, News & General
Topic: Total International Stock Index includes small caps or not?
Replies: 9
Views: 1305

Re: Should a BH investor never use futures/options?

You can use them to hedge your exposure to your own company's stock. Check with your compliance department; many corporations do not allow you to trade options on your own company's stock, and others may not allow you to take an adverse position such as buying a put, particularly if you are restric...
by grabiner
Wed Mar 25, 2015 8:26 pm
 
Forum: Investing - Theory, News & General
Topic: Should a BH investor never use futures/options?
Replies: 50
Views: 2858

Re: Vanguard Screwed up 1099-B

I will hold off on filing my taxes until close to 4/15 to see if I get a new 1099B. If you are still waiting, you can file for an extension, with a payment of an estimate of tax due, and then file the full return through October 15 with no penalty. (If you underpay, you may owe a small amount of in...
by grabiner
Wed Mar 25, 2015 7:58 pm
 
Forum: Personal Finance (Not Investing)
Topic: Vanguard [Messed up] 1099-B
Replies: 8
Views: 1555

Re: Free Credit Report

Since it has been a while since you checked your credit reports, you might consider checking your fico score also. You can do this for free with credi karma. https://www.creditkarma.com/ Credit Karma gives a VantageScore 3.0, not a FICO score. This is a score used by some lenders, although FICO is ...
by grabiner
Tue Mar 24, 2015 10:35 pm
 
Forum: Personal Finance (Not Investing)
Topic: Free Credit Report
Replies: 8
Views: 833

Re: Corrected 1099-DIV: Do I have to amend my return?

Same with Form 1116 - not really complicated if all you have is RIC investments and you follow the instructions. You probably haven't gotten it right if you think it isn't complicated; in particular, tax software can't get it right. (Usually, the failure to get it right won't matter.) Suppose that ...
by grabiner
Tue Mar 24, 2015 10:32 pm
 
Forum: Personal Finance (Not Investing)
Topic: Corrected 1099-DIV: Do I have to amend my return?
Replies: 12
Views: 1107

Re: Do all cost-basis calcs yield the same total capital gai

All cost-basis calculations yield the same total capital gains if you sell all the shares . But if you donate some of your shares to charity, or leave them to your heirs, specific identification will reduce your total capital gains, because you can make the shares you never sell those with the lowes...
by grabiner
Tue Mar 24, 2015 10:09 pm
 
Forum: Investing - Theory, News & General
Topic: Do all cost-basis calcs yield the same total capital gains
Replies: 5
Views: 444

Re: Vanguard fund in 401k with higher fees

There is a cost to run a 401(k), and it may be paid by either the employer or the plan accounts. John Hancock has an agreement that the plan accounts pay the fees, which appear to be about 1%. All you can do about this is max out other accounts (your 401(k), IRAs, 529 for children's college savings)...
by grabiner
Tue Mar 24, 2015 9:52 pm
 
Forum: Investing - Theory, News & General
Topic: Vanguard fund in 401k with higher fees
Replies: 4
Views: 422

Re: HSA as a retirement account

This is a great idea as long as you max out your retirement accounts; see Health savings account on the wiki. If you don't max out your retirement accounts, then it is better to use the HSA for current expenses. If you have a $1000 medical bill and $1000 in your checking account, you can pay the med...
by grabiner
Tue Mar 24, 2015 9:45 pm
 
Forum: Investing - Help with Personal Investments
Topic: HSA as a retirement account
Replies: 2
Views: 342

Re: Difference between SEC yield and Distribution yield

Another issue is that funds may amortize premiums; thus, the distribution yield for the same bond may depend on when the fund bought it. Consider that example Treasury bond. If you had bought the bond at par for $100, you would owe tax on the dividend of $2.875 annually. But if you bought the bond t...
by grabiner
Tue Mar 24, 2015 9:39 pm
 
Forum: Investing - Help with Personal Investments
Topic: Difference between SEC yield and Distribution yield
Replies: 3
Views: 480

Re: Munis when moving to a different state

Welcome to the forum! There will be almost no cost to switch funds when you move; capital gains on muni funds are usually very low. If you move from NY to CA, you will owe NY tax on any dividends you earned while you are a NY resident, and CA tax on any dividends you earned while you are a CA reside...
by grabiner
Tue Mar 24, 2015 9:26 pm
 
Forum: Investing - Help with Personal Investments
Topic: Munis when moving to a different state
Replies: 7
Views: 811

Re: Fidelity offer to match IRA contributions

One has to transfer half a million ($500,000) to get 10%. Less than $10,000 gets nothing, $10K gets 1%. That puts it in perspective. And the match is only on the annual contributions. If you transfer $500K, you will get a 10% match on the $16,500 you contribute over the next three years, which is $...
by grabiner
Tue Mar 24, 2015 9:21 pm
 
Forum: Investing - Help with Personal Investments
Topic: Fidelity offer to match IRA contributions
Replies: 12
Views: 2194

Re: Tax Differed Variable Annuity

Fidelity is currently looking more attractive because it only charges 0.25% expense ration and the sp500 index fund is only 0.1% for a total of 0.35% expense ration. It doesn't make sense to buy a variable annuity to hold a stock index fund. Gains on variable annuities are not taxed until you withd...
by grabiner
Tue Mar 24, 2015 9:15 pm
 
Forum: Investing - Help with Personal Investments
Topic: Tax Differed Variable Annuity
Replies: 16
Views: 1133

Re: Company Savings plan-was Riffed, Now what

You may also be able to roll the old 401(k) into a 401(k) at your new employer (but check the options first; using an IRA might be better because high fees are common in 401(k) plans).
by grabiner
Tue Mar 24, 2015 9:07 pm
 
Forum: Investing - Help with Personal Investments
Topic: Company Savings plan-was Riffed, Now what
Replies: 14
Views: 1920

Re: Why Funds Over ETFs?

One factor I don't see mentioned here - for taxable accounts, at least with Vanguard, it's much easier to make charitable donations of ETFs. Is this actually the case? I made a donation of mutual fund shares to a charity, and didn't have any problem once I got the charity to fill out the forms on w...
by grabiner
Tue Mar 24, 2015 9:05 pm
 
Forum: Investing - Help with Personal Investments
Topic: Why Funds Over ETFs?
Replies: 57
Views: 5331

Re: Vanguard Screwed up 1099-B

A portion of one stock position is covered but the vast majority is non-covered. Is the data right on the covered shares? If it is, just enter your own correct numbers for the non-covered shares. It's common to get incorrect data for non-covered shares. Vanguard doesn't have correct cost basis info...
by grabiner
Tue Mar 24, 2015 9:03 pm
 
Forum: Personal Finance (Not Investing)
Topic: Vanguard [Messed up] 1099-B
Replies: 8
Views: 1555

Re: Vanguard Screwed up 1099-B

Are the shares covered or non-covered? If they are covered, then Vanguard is reporting information to the IRS, which the IRS will check against your return, so you need to get it fixed before you file (or, failing that, report on the Form 8949 that Vanguard's information is wrong, which can sometime...
by grabiner
Mon Mar 23, 2015 11:17 pm
 
Forum: Personal Finance (Not Investing)
Topic: Vanguard [Messed up] 1099-B
Replies: 8
Views: 1555

Re: refinance or pay down mortgage?

Guys, so I did some further digging with all your posted suggestions in mind. To recap, my current residential loan is at ~100k (4.5% fixed rate) with 7 years remaining, but I have the ability to pay it off in a few years. But, I see some really attractive ARM products that may make financial sense...
by grabiner
Mon Mar 23, 2015 10:36 pm
 
Forum: Investing - Help with Personal Investments
Topic: refinance or pay down mortgage?
Replies: 14
Views: 1478

Re: Georgia Retirement Income Exclusion

I also find international income(dividends) are also considered deductible in Ga. Looks like TT handles this income as "out of state" :D As I read the 2014 tax instructions , this would only apply if you are a non-resident, and that is the rule in most states. The only adjustment for GA r...
by grabiner
Mon Mar 23, 2015 10:16 pm
 
Forum: Personal Finance (Not Investing)
Topic: Georgia Retirement Income Exclusion
Replies: 22
Views: 2398

Re: Newbie.. 401k & investment advice please

thanks very much for the responses. I think we can put aside 2k every month for retirement. Also, I read a little about backdoor roth IRA but I am not sure if its a lengthy process? If its not a complex procedure I am ready to do that for 2015 (2014 also if its possible). Will I have to do anything...
by grabiner
Mon Mar 23, 2015 10:06 pm
 
Forum: Investing - Help with Personal Investments
Topic: Newbie.. 401k & investment advice please
Replies: 40
Views: 2716

Re: Foreign stocks/bonds may be less beneficial for retirees

1) Adding foreign stocks increases the volatility of portfolio returns. The reason to add foreign stocks is that some diversification decreases the risk. While foreign stocks have the additional risks of their own markets and of currency fluctuation, these risks are not correlated with US stock ris...
by grabiner
Sun Mar 22, 2015 11:22 pm
 
Forum: Investing - Theory, News & General
Topic: Foreign stocks/bonds may be less beneficial for retirees
Replies: 26
Views: 2321

Re: Military TSP and/or IRA?

Makes sense. For allocation between the TSP and ROTH is it adventitious to keep the 3 fund princapal in both accounts or have 1 account hold most/all of the bonds? It's better to keep all your bonds in the G fund, because the G fund is a free lunch; it has the returns of an intermediate-term bond f...
by grabiner
Sun Mar 22, 2015 11:11 pm
 
Forum: Investing - Help with Personal Investments
Topic: Military TSP and/or IRA?
Replies: 36
Views: 1386

Re: Differences in costs of funds

Costs are important, but they aren't the only factor. Vanguard Emerging Markets Index (this is what VWO is) and High-Yield Corporate are in different asset classes, and are thus worth holding if you want to hold these asset classes. You might not want them, though. Total International (VXUS or VTIAX...
by grabiner
Sun Mar 22, 2015 11:08 pm
 
Forum: Investing - Help with Personal Investments
Topic: Differences in costs of funds
Replies: 10
Views: 614

Re: VWENX in taxable account

Have you considered VTMFX https://personal.vanguard.com/us/funds/snapshot?FundId=0103&FundIntExt=INT Vanguard Tax-Managed Balanced Fund Admiral Shares ? ER 0.12 and 50/50 AA. I think the OP expects to retire in a 15% tax bracket, which would make this fund inappropriate because of the municipal...
by grabiner
Sun Mar 22, 2015 11:03 pm
 
Forum: Investing - Help with Personal Investments
Topic: VWENX in taxable account
Replies: 5
Views: 694

Re: 403b vs A & C shares

Assuming a typical fee structure, A shares charge a 5.75% load up front and 0.25% 12b(1) fee annually, and C shares charge no load up front and a 1% 12b(1) fee annually. If this is your fee structure, then A shares will cost 8% for nine years, and C shares will cost 9%, beyond the operating expenses...
by grabiner
Sun Mar 22, 2015 10:18 pm
 
Forum: Investing - Help with Personal Investments
Topic: 403b vs A & C shares
Replies: 5
Views: 375

Re: How do you invest your taxable account?

While loading your tax-deferred accounts with taxable bonds results in a slightly higher yield in the short-term (compared to munis in taxable accounts), it is more advantageous over the long-term to put equities (esp. dividend-paying or actively-managed) into tax-deferred or tax-free. According to...
by grabiner
Sun Mar 22, 2015 9:15 pm
 
Forum: Investing - Theory, News & General
Topic: How do you invest your taxable account?
Replies: 62
Views: 5842

Re: Calculating Number of Allowances when Itemizing Taxes

Claiming a lot of withholding allowances when you have a big mortgage is quite common. Your withholding is based on your salary, minus $4000 per allowance. Therefore, if you have a lot of income other than salary, you need to claim fewer allowances in order to withhold enough to cover your taxes; if...
by grabiner
Sun Mar 22, 2015 11:48 am
 
Forum: Personal Finance (Not Investing)
Topic: Calculating Number of Allowances when Itemizing Taxes
Replies: 3
Views: 361

Re: Math majors needed in here for loan interest rates thoug

I'd like to assume for the scenario that stocks will perform at 5% or better, basically better than the interest of an auto loan. Yes, if you start with the unreasonable assumption that you can count on stock returns being greater than 5% for the duration of a car loan , you will arrive at the conc...
by grabiner
Sun Mar 22, 2015 11:38 am
 
Forum: Personal Finance (Not Investing)
Topic: Math majors needed in here for loan interest rates thoughts
Replies: 36
Views: 2099

Re: How mutual fund distribution affects performance?

The distribution reduces NAV, but it doesn't affect performance. Look for "Growth of $10,000" charts, or reported annualized returns. For example, suppose that you have 1000 shares of a fund worth $10 per share. The fund distributes a capital gain of $2 per share, and you reinvest the $200...
by grabiner
Sun Mar 22, 2015 11:32 am
 
Forum: Investing - Theory, News & General
Topic: How mutual fund distribution affects performance?
Replies: 6
Views: 734

Re: Any reason not to divvy equity between LC, MC, and SC?

The best way to estimate overlap is to use the definitions of indexes. If you use mid-cap and small-cap funds from the same provider (such as Vanguard), there will be no overlap. Vanguard's large-cap and mid-cap funds do have overlap because the large-cap funds include the mid-cap class as well; if ...
by grabiner
Sun Mar 22, 2015 11:27 am
 
Forum: Investing - Theory, News & General
Topic: Any reason not to divvy equity between LC, MC, and SC?
Replies: 4
Views: 573

Re: Can I roll VA into Traditional IRA tax-free?

Perhaps surrender penalties have ended after 7 years, but if not and you are close to the end of the surrender period, you might want to retain the VA until the surrender period ends. Usually, surrender penalties decline over time, so it is worth paying a small surrender penalty to avoid paying hig...
by grabiner
Sun Mar 22, 2015 11:22 am
 
Forum: Investing - Help with Personal Investments
Topic: Can I roll VA into Traditional IRA tax-free?
Replies: 5
Views: 405
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