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Re: Reversing a Roth overpayment

I don't see where you get $40 as the taxable amount. Your TIRA basis is 5500 ( 2013 Form 8606) and you are converting 5590, so you have taxable income of $90 for your conversion. You apparently made one or more errors on dates. If you already have the 1099R for the conversion of 5590, you must have...
by redstreet
Mon Sep 15, 2014 11:54 pm
 
Forum: Investing - Help with Personal Investments
Topic: Reversing a Roth overpayment
Replies: 11
Views: 1254

Re: Reversing a Roth overpayment

I'm having to resurrect this old thread because I'm confused about how the tax filing on this works. Say I do this, all for the year 2013: (1) contribute $5500 to Roth IRA in Sep 2013 (2) Realize I was ineligible for a Roth contribution, and so, have my Roth IRA *recharacterized* (in securities) to ...
by redstreet
Mon Sep 15, 2014 10:39 pm
 
Forum: Investing - Help with Personal Investments
Topic: Reversing a Roth overpayment
Replies: 11
Views: 1254

Re: Return to India - 401k?

Is there a reason why you can't wait 2 years, then either take it out after paying a penalty or keep it in depending up on where you are geographically and in life? If you can do this, seems like a good strategy to me.
by redstreet
Tue Jun 03, 2014 5:28 am
 
Forum: Investing - Help with Personal Investments
Topic: Return to India - 401k?
Replies: 16
Views: 1479

Re: Paying taxes due to IRS with multiple credit cards

Have you considered that the fees for using a credit card to pay and the interest charges on those credit card balances may exceed what the IRS would charge you for late payment penalties and interest? Thanks for the reply, but let me clarify: I can well afford to pay the taxes in cash (by check). ...
by redstreet
Tue Apr 01, 2014 11:14 am
 
Forum: Personal Finance (Not Investing)
Topic: Paying taxes due to IRS with multiple credit cards
Replies: 2
Views: 469

Paying taxes due to IRS with multiple credit cards

Does anyone know if IRS would have an issue if I made multiple payments to them via one of their credit card processors? Here's my situation: - I likely will not be able to file on time and plan to ask for an extension - I'd like to pay all my taxes on time (whatever I can estimate) - I'd like to us...
by redstreet
Tue Apr 01, 2014 5:18 am
 
Forum: Personal Finance (Not Investing)
Topic: Paying taxes due to IRS with multiple credit cards
Replies: 2
Views: 469

Re: Deductibility of estimated state taxes

scrabbler1, heh, yes, I've been reading about bunching in the last few hours when researching all of this. I live in CA and end up itemizing anyway virtually every year because of the tax rate here, but the technique definitely seems something to keep in my arsenal for use when needed. Sucks you lea...
by redstreet
Mon Mar 24, 2014 12:19 pm
 
Forum: Personal Finance (Not Investing)
Topic: Deductibility of estimated state taxes
Replies: 5
Views: 333

Re: Deductibility of estimated state taxes

Thanks, jebmke, that clears it up. Just looked up cash basis vs. accrual basis, etc. after your mention, and that makes sense. I'm kicking myself really, really hard for not having researched this better and making my payment in the calendar year. Can't believe I missed this. It's going to be quite ...
by redstreet
Mon Mar 24, 2014 11:18 am
 
Forum: Personal Finance (Not Investing)
Topic: Deductibility of estimated state taxes
Replies: 5
Views: 333

Deductibility of estimated state taxes

Following a windfall, I made a significant estimated state tax payment before the deadline (state) of Jan 15 2014. I assumed I could deduct it from my federal taxable income, but now I'm confused. The IRS page at [1] says: Estimated tax payments. You can deduct estimated tax payments you made during...
by redstreet
Mon Mar 24, 2014 10:04 am
 
Forum: Personal Finance (Not Investing)
Topic: Deductibility of estimated state taxes
Replies: 5
Views: 333

Re: Reversing a Roth overpayment

As an update: I did what was mentioned in this thread, and it was all smooth and easy. Thanks everybody, again! Summary: Roth IRA contribution --> recharacterize into tIRA --> conversion to Roth IRA The steps were: 1) (earlier on) I contributed $5500 to Roth IRA 2) found out I was ineligible for Rot...
by redstreet
Fri Nov 08, 2013 7:25 pm
 
Forum: Investing - Help with Personal Investments
Topic: Reversing a Roth overpayment
Replies: 11
Views: 1254

Re: Reversing a Roth overpayment

Look into recharacterization. You can recharacterize your Roth contribution into a Traditional IRA. I'm not 100% on all the details you need to know, but I did exactly this earlier in the year. I'm still trying to figure out whether I can later recharacterize back and have it work as a back door. D...
by redstreet
Fri Nov 08, 2013 7:22 pm
 
Forum: Investing - Help with Personal Investments
Topic: Reversing a Roth overpayment
Replies: 11
Views: 1254

Re: Buying a car outright smartest financially?

Have you considered http://relayrides.com/ instead? At least for a cost comparison?
by redstreet
Sat Jul 06, 2013 5:01 am
 
Forum: Personal Consumer Issues
Topic: Buying a car outright smartest financially?
Replies: 149
Views: 10566

Re: Question about community properties and taxation

Thanks very much, Nonnie. I'm reading through the links your provided right now. One question about your post: In the case of income taxes, if you use separate funds to pay income taxes all that means is these funds (funds used to pay taxes) are considered community funds. I'm a bit confused. If I h...
by redstreet
Thu Jun 27, 2013 5:59 pm
 
Forum: Personal Finance (Not Investing)
Topic: Question about community properties and taxation
Replies: 16
Views: 1464

Re: Minimizing tax liability on a windfall

Since in a prior post you said you are already in the 28% bracket without this large bonus, your tax situation might be worse than you think. Thanks for the cheer, "Bob's not my name" :). Thankfully, I already went through this exercise and computed almost everything to the T, and none of...
by redstreet
Mon Jun 17, 2013 6:47 am
 
Forum: Personal Finance (Not Investing)
Topic: Minimizing tax liability on a windfall
Replies: 6
Views: 862

Re: Minimizing tax liability on a windfall

Thanks, Nebster. I hadn't thought about donor-advised funds. I also made a note to ensure I optimize the usual year-to-year lumpings. Restablishing residency is not an option in my case :). I also hadn't figured state tax deduction in my marginal rate. So if I'm thinking correctly, for every margina...
by redstreet
Mon Jun 17, 2013 6:40 am
 
Forum: Personal Finance (Not Investing)
Topic: Minimizing tax liability on a windfall
Replies: 6
Views: 862

Minimizing tax liability on a windfall

I might be getting a small sum of money this year, say about half my salary. I've already read http://www.bogleheads.org/wiki/Managing_a_windfall , and I was wondering if there's anything I can do to minimize my tax liability, since I'll likely be in the 28% federal / 9.3% CA bracket. So 37.3%, and ...
by redstreet
Mon Jun 17, 2013 4:36 am
 
Forum: Personal Finance (Not Investing)
Topic: Minimizing tax liability on a windfall
Replies: 6
Views: 862

Re: Best way to send a fax from a computer

I don't have an opinion about this, but it's why in our medical office we don't allow patients to email us private documents but instead work by fax. It's also one reason of many why we are PROHIBITED from emailing our patients. I don't agree with the policy, and often ignore it. But it's strange t...
by redstreet
Sun Jun 16, 2013 5:56 pm
 
Forum: Personal Consumer Issues
Topic: Best way to send a fax from a computer
Replies: 35
Views: 2902

Re: Best way to send a fax from a computer

If you find yourself wanting to send faxes on a regular basis, and if you're comfortable with tech (preferably, know the basics of a Linux system) it might be worth spending the 1 or 2 hours it takes to setup an Asterisk based system. It's a *lot* easier than it used to be a few years ago. Basically...
by redstreet
Sun Jun 16, 2013 4:55 am
 
Forum: Personal Consumer Issues
Topic: Best way to send a fax from a computer
Replies: 35
Views: 2902

Re: Question about community properties and taxation

You can file "married filing separately" on your federal return and apportion income and deductions to whom each accrued what. I presume California has some sort of similar filing provision. It does, but I was mainly concerned about the case where the filing is done jointly. Sorry, I edit...
by redstreet
Sun Jun 16, 2013 12:09 am
 
Forum: Personal Finance (Not Investing)
Topic: Question about community properties and taxation
Replies: 16
Views: 1464

Re: Question about community properties and taxation

While most married couples file joint returns (since the tax on a joint return is usually less than the tax on separate returns), you can file separate returns if you want. In most cases, if you file a joint return, both spouses are liable for the entire tax. However, as between the spouses, you ca...
by redstreet
Sat Jun 15, 2013 11:29 pm
 
Forum: Personal Finance (Not Investing)
Topic: Question about community properties and taxation
Replies: 16
Views: 1464

Question about community properties and taxation

If I made money from capital gains (say, by selling stock) in say, August 2012, and then got married in December 2012 in a community property state (CA), I would have to file both federal and state income taxes as married for 2012. However, is it true that the capital gains I made in August is mine,...
by redstreet
Sat Jun 15, 2013 10:59 pm
 
Forum: Personal Finance (Not Investing)
Topic: Question about community properties and taxation
Replies: 16
Views: 1464

Re: Relocating advice

I'm curious about this. I am not a big Craigslist user, so maybe the answer to my question is obvious. How do you find cheap labor on Craigslist? Just look for people offering "cheap labor"? Seems like an odd thing to do in your new location, hiring strangers off of Craigslist to move you...
by redstreet
Sun Apr 14, 2013 5:16 pm
 
Forum: Personal Consumer Issues
Topic: Relocating advice
Replies: 17
Views: 1074

Re: Relocating advice

BTW, if you use ABF, you can get cheap labor from Craigslist ($10-15 /hr) for moving stuff from your apartment to the cube and back.
by redstreet
Sun Apr 14, 2013 4:34 pm
 
Forum: Personal Consumer Issues
Topic: Relocating advice
Replies: 17
Views: 1074

Re: Relocating advice

Two thumbs up for ABF. In addition to the moving model being great, they're the single most awesome company of any kind I've dealt with in years, with regard to customer service. I called them a bunch of times to get a quote, and a few more times, and *each* time, their customer service reps were ve...
by redstreet
Sun Apr 14, 2013 4:27 pm
 
Forum: Personal Consumer Issues
Topic: Relocating advice
Replies: 17
Views: 1074

Re: A simple plan for a simple investor getting close to ret

This is going to sound so stupid but how would I determine the Marginal Tax Rate? This is the highest tax bracket that you are taxed at. Find your "Taxable income" (line 43 on 2012's 1040). Google for "2012 federal tax brackets married filing jointly" and allocate your income in...
by redstreet
Thu Apr 11, 2013 11:21 pm
 
Forum: Investing - Help with Personal Investments
Topic: A simple plan for a simple investor getting close to retirem
Replies: 23
Views: 4314

Re: ETF vs Index Fund

ETFs can have tax advantages. Due to structural differences mutual finds incur more capital gains. Typically an ETF investors only incurs a capital gain when selling shares Though true, this doesn't apply to the OP's case because Vanguard ETFs are shares of conventional Vanguard index funds. Q: How...
by redstreet
Thu Apr 11, 2013 3:09 am
 
Forum: Investing - Help with Personal Investments
Topic: ETF vs Index Fund
Replies: 19
Views: 1345

Re: Reversing a Roth overpayment

Alan S., thank you, that was very helpful!

I'm going to try to rollover the 401k to the new employer (unless they are really bad), and re-characterize as TIRA and transfer back to Roth IRA as you suggested.

Also thanks, Epsilon Delta and others for the suggestions/clarifications.
by redstreet
Wed Apr 10, 2013 1:57 am
 
Forum: Investing - Help with Personal Investments
Topic: Reversing a Roth overpayment
Replies: 11
Views: 1254

Re: Should I buy a car or get my current one repaired?

Those seem like somewhat extreme options: keep a car worth $1500, or buy one for $20k. Have you considered something in between? A nice used car for $5k-8k? Should be a better sweet spot along the reliability--price curve. I would personally stick with the existing car, assuming everything else is o...
by redstreet
Tue Apr 09, 2013 6:20 am
 
Forum: Personal Consumer Issues
Topic: Should I buy a car or get my current one repaired?
Replies: 23
Views: 1740

Reversing a Roth overpayment

Hello folks, I have some questions about Roth over-contributions, etc.: Situation: I contributed the full 2013 amount to Roth ($5500) back in Jan, and found that I might need to reverse it because I will likely go over the income limit. According to [1], I'll have to: 1) Withdraw my contributions 2)...
by redstreet
Mon Apr 08, 2013 5:18 am
 
Forum: Investing - Help with Personal Investments
Topic: Reversing a Roth overpayment
Replies: 11
Views: 1254

Re: Question about Vanguard's after-tax returns

I would say it is the case. But you need to look at the difference between pre-tax and after-tax returns, not at their ratio . As the tables below show, over the last 10 years TSM's after-tax-on-distributions return is only 0.3% points less than the pre-tax; while for the REIT fund it is almost 1.5...
by redstreet
Sun Sep 30, 2012 8:29 pm
 
Forum: Investing - Help with Personal Investments
Topic: Question about Vanguard's after-tax returns
Replies: 16
Views: 789

Re: Question about Vanguard's after-tax returns

Actually, I find that one can understand the taxes on investments rather easily as long as one does not bother to look up "tax-cost ratio" or any of the "after-tax" returns reported by Vanguard or Morningstar. True, but unfortunately, that works only for the simpler cases: for e...
by redstreet
Sun Sep 30, 2012 8:01 pm
 
Forum: Investing - Help with Personal Investments
Topic: Question about Vanguard's after-tax returns
Replies: 16
Views: 789

Re: Question about Vanguard's after-tax returns

dbr: thanks for the note. Yes, this was actually why I was trying to understand how to make these comparisons, so I can customize them for my current and future estimated tax brackets, and also for state taxes. It's certainly not trivial to work out these numbers. I wonder how much collective time i...
by redstreet
Sun Sep 30, 2012 7:35 pm
 
Forum: Investing - Help with Personal Investments
Topic: Question about Vanguard's after-tax returns
Replies: 16
Views: 789

Re: Question about Vanguard's after-tax returns

Is that what the SEC reference says? I though one year meant one year. Thanks for pointing this technicality out, but as I said, my question was about how to quantify and compare tax efficiency. If you ignore the 1yr number and look at the 3/5/10yr number, my question still stands independent of th...
by redstreet
Sun Sep 30, 2012 7:14 pm
 
Forum: Investing - Help with Personal Investments
Topic: Question about Vanguard's after-tax returns
Replies: 16
Views: 789

Re: Question about Vanguard's after-tax returns

KyleAAA : Ah, the tax-cost ratio is the metric I was looking for, I guess. Thanks for this!

Also, KyleAAA and Epsilon Delta, thanks for pointing out that small differences in after-tax returns become significant over long periods of time, helps to keep this in mind as I work out the numbers.
by redstreet
Sun Sep 30, 2012 6:58 pm
 
Forum: Investing - Help with Personal Investments
Topic: Question about Vanguard's after-tax returns
Replies: 16
Views: 789

Re: Question about Vanguard's after-tax returns

sscritic: none of what you say answers my question. Nor did I post anything that claims what you assume I claimed. The long-term sale assumption is something I got from calling Vanguard (though their agents have occasionally been wrong). The assumption is, you sell on Dec 31, but that you bought it ...
by redstreet
Sun Sep 30, 2012 6:54 pm
 
Forum: Investing - Help with Personal Investments
Topic: Question about Vanguard's after-tax returns
Replies: 16
Views: 789

Re: Question about Vanguard's after-tax returns

I guess my question is: it doesn't seem to be that much more tax efficient, only very slightly so, to the point of being insignificant. Most income from both REIT and TSM seem to come from appreciation, and not distributions. Also, I don't see a huge difference for the 3, 5, and 10 years either. My ...
by redstreet
Sun Sep 30, 2012 6:18 pm
 
Forum: Investing - Help with Personal Investments
Topic: Question about Vanguard's after-tax returns
Replies: 16
Views: 789

Question about Vanguard's after-tax returns

Vanguard provides after-tax returns for funds. They provide three lines as shown below. I'm trying to determine how tax efficient a fund is by looking at these numbers, and am unable to do so. So my question is: what do these numbers mean? From what I understand so far (from their "Learn more a...
by redstreet
Sun Sep 30, 2012 5:47 pm
 
Forum: Investing - Help with Personal Investments
Topic: Question about Vanguard's after-tax returns
Replies: 16
Views: 789

Re: VGSH dividends from government obligations for income ta

grabiner wrote:However, in some states, the fund must have a minimum percentage of investments in US Government obligations to qualify for any beneficial tax treatment at all; that is why Vanguard reports both bumbers.


Ah, I always wondered why they included that column. Thanks for this info.
by redstreet
Fri Apr 06, 2012 4:48 pm
 
Forum: Investing - Help with Personal Investments
Topic: VGSH dividends from government obligations for income tax
Replies: 5
Views: 381

Re: VGSH dividends from government obligations for income ta

It may be close in this case, but normally, you'll need to figure out the percentage of income that is from U.S. Treasury obligations, and not the percentage of investment of the mutual fund/ETF in U.S. Treasury obligations to determine the amount exempt from state tax. (Obligatory disclaimer: not p...
by redstreet
Fri Apr 06, 2012 5:38 am
 
Forum: Investing - Help with Personal Investments
Topic: VGSH dividends from government obligations for income tax
Replies: 5
Views: 381

Re: Newbie getting started: portfolio advice requested

You set a goal to retire in 12 years (+/- 2). Assets of $175K, plus Contributions of $50K x 12-14 = $600K-$700K, put you on good pace to break $1 million in 2011 dollars. On the other side of the equation, in 10 years, you are likely short. OK, that's out of the way, but a great place to start. 1. ...
by redstreet
Tue Jan 17, 2012 5:08 am
 
Forum: Investing - Help with Personal Investments
Topic: Newbie getting started: portfolio advice requested
Replies: 9
Views: 416

Re: Newbie getting started: portfolio advice requested

Your goal is achievable, but I think if you reach it, you will probably modify it as you see the lay of the land in 12 years. Modify it in which way? Do you think I'll likely continue to work and put off retirement, or do you think I'll get more risky in my investments perhaps? For international eq...
by redstreet
Tue Jan 17, 2012 4:41 am
 
Forum: Investing - Help with Personal Investments
Topic: Newbie getting started: portfolio advice requested
Replies: 9
Views: 416

Re: Newbie getting started: portfolio advice requested

I plan on spending up to $8000 per year in retirement for an individual health plan until Medicare kicks in. If premiums+deductibles turn out to be much more expensive than that, I plan to work a month or two each year as needed. On a related note, I won't be covered for short-term or long-term dis...
by redstreet
Tue Jan 17, 2012 4:37 am
 
Forum: Investing - Help with Personal Investments
Topic: Newbie getting started: portfolio advice requested
Replies: 9
Views: 416

Re: Newbie getting started: portfolio advice requested

If retiring at age 47, what is your plan for covering healthcare? Good question. I plan on spending up to $8000 per year in retirement for an individual health plan until Medicare kicks in. If premiums+deductibles turn out to be much more expensive than that, I plan to work a month or two each year...
by redstreet
Mon Jan 16, 2012 5:05 am
 
Forum: Investing - Help with Personal Investments
Topic: Newbie getting started: portfolio advice requested
Replies: 9
Views: 416

Newbie getting started: portfolio advice requested

Hi all, Long time lurker just starting out, and I'd much appreciate your advice and input on my investment goals and plan. Goal and financial summary: Goal: retire within 12 (+/-2) years with $1M (in 2011 dollars) Age: 35yo, single Debt: none Property/mortgage: none (I rent) Current assets: $175K An...
by redstreet
Mon Jan 16, 2012 4:22 am
 
Forum: Investing - Help with Personal Investments
Topic: Newbie getting started: portfolio advice requested
Replies: 9
Views: 416

kaneohe, sscritic, thanks a bunch for your responses!

kaneohe, thanks for the pointer to fairmark.

sscritic, thanks much for making sense of this and explaining it, and also pointing me to that relevant example! What you said makes sense to me. :)

I'm finally done with my taxes!
by redstreet
Tue Apr 12, 2011 4:09 am
 
Forum: Personal Finance (Not Investing)
Topic: Help with tax filing! CA Part-year resident capital losses
Replies: 4
Views: 1128

Help with tax filing! CA Part-year resident capital losses

Hello Fellow-Bogleheaders, I'm having a hard time figuring out my CA taxes, and would much appreciate help. I moved into CA in Dec 2010, and will thus file as a part-year resident. I sold equities in Feb 2010, incurring a net capital loss of about $3100 ($100 capital gain, $3200 capital loss). The t...
by redstreet
Sun Apr 10, 2011 5:20 pm
 
Forum: Personal Finance (Not Investing)
Topic: Help with tax filing! CA Part-year resident capital losses
Replies: 4
Views: 1128

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