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Re: Is the backdoor Roth IRA legal?

Yes, really legal. The question of whether backdoor Roths are ethical despite their legality was recently addressed by "the Ethicist" in the July 11, 2014 NY Times Magazine: Q: My spouse and I earn too much to contribute to a Roth I.R.A. Recently, we learned that it is legal to contribute ...
by rjc32000
Mon Oct 20, 2014 3:52 pm
 
Forum: Investing - Theory, News & General
Topic: Is the backdoor Roth IRA legal?
Replies: 13
Views: 1727

Re: taxes on family loan for mortgage downpayment?

Sorry, I'm not the most savvy person when it comes to taxes, so I'm grateful for the wisdom of the forum! I always understood that any banking transaction in excess of $10k was reported to IRS, which was the basis of my concern. Thanks again for your response! Rjc32000 No real concerns from me. I'd ...
by rjc32000
Thu Jul 03, 2014 2:17 am
 
Forum: Personal Finance (Not Investing)
Topic: taxes on family loan for mortgage downpayment?
Replies: 10
Views: 826

Re: taxes on family loan for mortgage downpayment?

Thanks, Bill. I appreciate your input. Out of curiosity, which are you "yikesing" to? I posted my question in hopes that folks would share their concerns with me; why "yikes?" Yikes. Any gift you receive is never taxable to you. IRS doesn't see bank statements. All they get is 10...
by rjc32000
Wed Jul 02, 2014 5:20 pm
 
Forum: Personal Finance (Not Investing)
Topic: taxes on family loan for mortgage downpayment?
Replies: 10
Views: 826

Re: taxes on family loan for mortgage downpayment?

Thank you. We have already factored in loan repayment to family member in our analysis of what we can afford. We've got more than enough assets to cover the downpayment ourselves ad have provided proof of this to lender. But taking a short-term loan from family member will save us an awful lot in sh...
by rjc32000
Wed Jul 02, 2014 5:18 pm
 
Forum: Personal Finance (Not Investing)
Topic: taxes on family loan for mortgage downpayment?
Replies: 10
Views: 826

taxes on family loan for mortgage downpayment?

The love of my life and I are in the process of purchasing a home together. We are a little cash poor, but have an offer from a family member to do a short term loan to cover part of our 20% downpayment. My partner and I are putting approx $110k towards downpayment ourselves, and family member has o...
by rjc32000
Wed Jul 02, 2014 2:50 pm
 
Forum: Personal Finance (Not Investing)
Topic: taxes on family loan for mortgage downpayment?
Replies: 10
Views: 826

Re: Suggestions for 1-2 Days in NYC?

For cheap thrills and sightseeing, it is tough to beat the Staten Island ferry. Great views of the Manhattan skyline, a decent view of the statue of liberty, and best of all it is free! Hi, I'll be taking a trip and will head out to NYC for a couple days. I have never been, so I look to these forums...
by rjc32000
Mon Jun 23, 2014 8:21 pm
 
Forum: Personal Consumer Issues
Topic: Suggestions for 1-2 Days in NYC?
Replies: 51
Views: 3707

Re: Experience with Lynda.com? [online tech training]

I LOVE Lynda.com. For the money, it is difficult to beat the breadth and depth of information. I agree with other posters that Lynda will not necessarily make you an expert in anything, but will walk you though the fundamentals of most software programs. As a small business owner, I have found the t...
by rjc32000
Tue Jun 17, 2014 1:59 pm
 
Forum: Personal Consumer Issues
Topic: Experience with Lynda.com? [online tech training]
Replies: 7
Views: 1012

Re: I need a Bogleheads reminder [New home - how much to spe

I'm not sure if anyone other than yourself can answer your question because people really value homes in different ways and for different reasons, but I also don't think the answer is as simple as "just buy the cheaper house." As someone who resides in a cold climate (I can almost see Russ...
by rjc32000
Fri Jun 13, 2014 7:46 pm
 
Forum: Personal Finance (Not Investing)
Topic: I need a Bogleheads reminder [New home - how much to spend?]
Replies: 44
Views: 2824

Re: House downpayment: where should I withdraw the money fro

Congratulations on the pending home purchase! My SO are going through the same process right now. For financing, we will draw as much as possible from taxable/cash accounts before dipping into any tax-advantaged account like IRAs. As Ged correctly noted: It is nearly impossible to replace the funds ...
by rjc32000
Tue Jun 10, 2014 7:40 pm
 
Forum: Investing - Help with Personal Investments
Topic: House downpayment: where should I withdraw the money from?
Replies: 4
Views: 585

Re: buying home with life partner, need advice!

What's a life partner? The woman who lets me live with her. But seriously, we struggle with how to accurately describe our relationship since we aren't married but are nevertheless in what would otherwise appear by any account to be a traditional marriage-esque relationship. "Boyfriend/girlfri...
by rjc32000
Wed Jun 04, 2014 2:45 am
 
Forum: Personal Finance (Not Investing)
Topic: buying home with life partner, need advice!
Replies: 17
Views: 1290

Re: buying home with life partner, need advice!

You're probably correct: 3% difference might not cover the headaches of structuring such an arrangement. Thanks for the advice! OP, very good questions and it is great you are asking them in advance. Now in all seriousness, I think letting a 3% difference in tax rate on mortgage interest deduction w...
by rjc32000
Tue Jun 03, 2014 6:21 pm
 
Forum: Personal Finance (Not Investing)
Topic: buying home with life partner, need advice!
Replies: 17
Views: 1290

Re: buying home with life partner, need advice!

Thanks! No domestic partnership for us (we are a mixed-sex "traditional" couple), and we have no plans to marry despite being in a long term committed relationship. I think a trip to either a tax attorney or accountant is a worthwhile investment. Thanks for the advice! RJC, Congratulations...
by rjc32000
Tue Jun 03, 2014 6:18 pm
 
Forum: Personal Finance (Not Investing)
Topic: buying home with life partner, need advice!
Replies: 17
Views: 1290

buying home with life partner, need advice!

Hi, After much discussion and careful thought, my life partner and I have decided to purchase a home together. We are unmarried and have no plans to marry for a variety of reasons. We've lived together in my home for past 5 years, but agree that a larger home is a necessity for us. I'm curious how o...
by rjc32000
Tue Jun 03, 2014 5:13 pm
 
Forum: Personal Finance (Not Investing)
Topic: buying home with life partner, need advice!
Replies: 17
Views: 1290

Re: Appropriate Investments for HOA

You have no idea how uninformed most HOAs are. Our HOA treasurer recently proudly announced that since bond prices had dropped, he sold all of our bond holdings and would "buy back in" once the prices were higher. Yes, that's right: Our HOA investment strategy is selling low and buying hig...
by rjc32000
Fri May 30, 2014 2:41 pm
 
Forum: Investing - Help with Personal Investments
Topic: Appropriate Investments for HOA
Replies: 18
Views: 1190

Re: Backdoor Roth IRA Strategy? Help?

Option 2 is a pretty crappy one. The advantages of making non deductible TIRA contributions are minimal. I'm not sure if I would describe the advantages of tax-deferred growth over 20-30 years as "minimal." Sure you don't get to deduct your contribution from this year's taxes, and you mus...
by rjc32000
Thu May 08, 2014 1:41 pm
 
Forum: Investing - Help with Personal Investments
Topic: Backdoor Roth IRA Strategy? Help?
Replies: 85
Views: 13739

Re: Vacation - Hawaii, Mexico, other ideas?

I've spent tons of time in Hawaii and think it is pretty wonderful. However, I would echo some of the concerns from others. Hawaii is almost certainly the most expensive option, but you can save a little money pretty easily: Instead of renting a hotel room, check out VRBO.com and search for a condo ...
by rjc32000
Tue Feb 25, 2014 2:23 pm
 
Forum: Personal Consumer Issues
Topic: Vacation - Hawaii, Mexico, other ideas?
Replies: 54
Views: 3719

Yikes! $12.50 excess contribution to HSA

I somehow managed to overfund my HSA by a whopping $12.50 for 2013 (HSA Administrators). Is there an easy fix?
by rjc32000
Tue Feb 25, 2014 2:10 pm
 
Forum: Investing - Help with Personal Investments
Topic: Yikes! $12.50 excess contribution to HSA
Replies: 2
Views: 533

Re: HSA as stealth IRA - Inheritence issue

Hmmm...I'n certainly not an expert, but my understanding is that monies may be withdrawn from HSA at any time for approved health care expenses, and that this income isn't taxable (yes, you have avoided taxes when you earned the $, didn't incur taxes while it appreciated, and now aren't paying taxes...
by rjc32000
Tue Feb 25, 2014 2:00 pm
 
Forum: Personal Finance (Not Investing)
Topic: HSA as stealth IRA - Inheritence issue
Replies: 9
Views: 1288

Re: Honda CR-V vs Subaru Forester

I owned a 2003 CRV EX for 10 years (sold last year) and my partner drives a 2012 Forrester Limited. I think both are an excellent value. I personally would probably pick the CRV for no other reason than I think the interior is better. I only ran all-season tires on my CRV, but that worked just fine ...
by rjc32000
Thu Feb 20, 2014 8:05 pm
 
Forum: Personal Consumer Issues
Topic: Honda CR-V vs Subaru Forester (edit: decision made!)
Replies: 43
Views: 6014

Re: Buying snow tires

I'll add my two cents coming from a truly winter climate with snow/ice on the roads 6 months out of the year (Anchorage, AK). Blizzaks are awesome! I've got a set of the WS70s on my car, and it is just a tank. I would also second the recommendation that you consider a dedicated set of winter rims, e...
by rjc32000
Tue Dec 17, 2013 2:28 pm
 
Forum: Personal Consumer Issues
Topic: Buying snow tires
Replies: 55
Views: 4035

Re: Who here uses an electronic recipe collection ?

Sorry, it very well might be. I use it exclusively on my iPad.
by rjc32000
Sun Dec 01, 2013 5:24 pm
 
Forum: Personal Consumer Issues
Topic: Who here uses an electronic recipe collection ?
Replies: 18
Views: 917

Re: Who here uses an electronic recipe collection ?

+1 for Paprika. I use it all the time, and love the convenience. You can browse (within Paprika) to recipe websites, and it will automatically save and organize the ingredients, directions, etc. Super easy to double or half recipes, and you can generate and email a convenient shopping list from sing...
by rjc32000
Sun Dec 01, 2013 2:31 pm
 
Forum: Personal Consumer Issues
Topic: Who here uses an electronic recipe collection ?
Replies: 18
Views: 917

67years young, 2.3M in various accounts, please help!

My mom believes I am a financial guru despite telling her repeatedly that everything I know I learned on this forum or through a Bogleheads book. Regardless, she wants me to help her straighten out her portfolio. Her account is presently kind of a mess, although most of her assets are held with Vang...
by rjc32000
Fri Nov 08, 2013 6:28 pm
 
Forum: Investing - Help with Personal Investments
Topic: 67years young, 2.3M in various accounts, please help!
Replies: 11
Views: 1800

Re: No need to convert entire IRA for backdoor ROTH?

I see. Thanks for the clarification! Holy smokes, so I pay taxes twice? i.e., I invest $5k with after tax money, and then pay taxes on the conversion? It's not double taxation. In archbish99's example, out of your $5000 non-deductible contribution to the traditional IRA (on which you've already paid...
by rjc32000
Tue Oct 08, 2013 6:33 pm
 
Forum: Investing - Help with Personal Investments
Topic: No need to convert entire IRA for backdoor ROTH?
Replies: 25
Views: 1246

Re: No need to convert entire IRA for backdoor ROTH?

Whew, that's good news. I'm leaning towards option #2. So if I roll my TIRA into my 401k plan by year's end, then my $2000 conversion/backdoor is legit? i.e., it is as if I did rollover to 401k before I did the recharacterization? Do I have this right? God, I love this forum. Thanks to everyone and ...
by rjc32000
Tue Oct 08, 2013 5:00 pm
 
Forum: Investing - Help with Personal Investments
Topic: No need to convert entire IRA for backdoor ROTH?
Replies: 25
Views: 1246

Re: No need to convert entire IRA for backdoor ROTH?

Holy smokes, so I pay taxes twice? i.e., I invest $5k with after tax money, and then pay taxes on the conversion? Ouch! OK, I'm starting to get it. Unfortunately, this was not explained to me by my flagship rep ("no problem" were the exact words), and I converted $2000 (nondeductible contr...
by rjc32000
Tue Oct 08, 2013 4:02 pm
 
Forum: Investing - Help with Personal Investments
Topic: No need to convert entire IRA for backdoor ROTH?
Replies: 25
Views: 1246

Re: No need to convert entire IRA for backdoor ROTH?

Correct. The rollover IRA came from pre-tax contributions when I was employed by state government. Will I owe taxes on that $80k if I backdoor $5500 next year? rollover IRA with Vanguard (approx $80k) Where did this rollover IRA money originate? I assume that this came from pretax contributions to a...
by rjc32000
Tue Oct 08, 2013 3:38 pm
 
Forum: Investing - Help with Personal Investments
Topic: No need to convert entire IRA for backdoor ROTH?
Replies: 25
Views: 1246

Re: No need to convert entire IRA for backdoor ROTH?

Thanks! Forgive my ignorance, but what are the consequences of the "pro-rata rule." Why is this a nightmare situation? I am not eligible to contribute to ROTH due to income. I am not eligible for deductible contributions to traditional IRA due to income and existence of 401k plan. I curren...
by rjc32000
Tue Oct 08, 2013 3:29 pm
 
Forum: Investing - Help with Personal Investments
Topic: No need to convert entire IRA for backdoor ROTH?
Replies: 25
Views: 1246

Re: No need to convert entire IRA for backdoor ROTH?

I've seen that, but since my contributions to traditional IRA aren't deductible due to my ineligibility for deductible contributions, I'll be doing this investment with after-tax dollars. i.e., the $5500 I'll contribute annually into backdoor ROTH is subject to ordinary taxation already. Isn't the a...
by rjc32000
Tue Oct 08, 2013 3:12 pm
 
Forum: Investing - Help with Personal Investments
Topic: No need to convert entire IRA for backdoor ROTH?
Replies: 25
Views: 1246

No need to convert entire IRA for backdoor ROTH?

I am not eligible to contribute to ROTH due to income. I am not eligible for deductible contributions to traditional IRA due to income and existence of 401k plan. I currently have a rollover IRA with Vanguard (approx $80k) and a ROTH with Vanguard (approx $70k). I max out my deferred taxation retire...
by rjc32000
Tue Oct 08, 2013 2:14 pm
 
Forum: Investing - Help with Personal Investments
Topic: No need to convert entire IRA for backdoor ROTH?
Replies: 25
Views: 1246

Re: Asset allocation between Roth IRA and Tradional IRA?

Thanks, I hadn't really contemplated that. I really appreciate your input! This is a popular misunderstanding, but what you are missing is that Roth dollars are worth more than trad IRA dollars. So $50K stocks in the Roth and $50K bonds in the tIRA is riskier than the other way around. If you measur...
by rjc32000
Wed Sep 25, 2013 6:17 pm
 
Forum: Investing - Help with Personal Investments
Topic: Asset allocation between Roth IRA and Tradional IRA?
Replies: 6
Views: 456

Re: Asset allocation between Roth IRA and Tradional IRA?

Sorry, I should have provided more details, but thank for you the quick replies! I max out my tax-deferred accounts (401k, HSA) every year, and my income precludes me from making contributions to Roth or tax-deductaable contributions to standard IRA (although I'm looking into possibly doing backdoor...
by rjc32000
Wed Sep 25, 2013 6:15 pm
 
Forum: Investing - Help with Personal Investments
Topic: Asset allocation between Roth IRA and Tradional IRA?
Replies: 6
Views: 456

Asset allocation between Roth IRA and Tradional IRA?

Is there any conventional wisdom about how to allocate assets between Roth IRA and IRA accounts? i.e., put bond funds in IRA vs. Roth? Keep same AA in both accounts, etc? It occurs to me that if my Roth withdrawals are tax free, then it might make more sense to keep more aggressive investments (stoc...
by rjc32000
Wed Sep 25, 2013 5:34 pm
 
Forum: Investing - Help with Personal Investments
Topic: Asset allocation between Roth IRA and Tradional IRA?
Replies: 6
Views: 456

Re: 503 college plan as gift?

Yes, sorry. 529 plan is indeed what I meant. Thanks!
by rjc32000
Sun Aug 11, 2013 10:00 pm
 
Forum: Investing - Help with Personal Investments
Topic: 529 college plan as gift?
Replies: 7
Views: 429

529 college plan as gift?

Some very close friends are about to have their first child. Instead of typical baby presents which will only be useful for a few months, we'd like to fund a 529 college savings plan as a gift. Can we open a plan for the child? We don't intend to fund it after the initial investment, but would like ...
by rjc32000
Sat Aug 10, 2013 10:11 pm
 
Forum: Investing - Help with Personal Investments
Topic: 529 college plan as gift?
Replies: 7
Views: 429

Re: Honda CRV

I can't speak to the new models, but I sold my 03 CRV last year and that thing was just great for what it was: an inexpensive and reliable sport-cute with lots of room for passengers and cargo. I didn't have a single problem in the 10 year I owned it, but did regular oil changes and maintenance reco...
by rjc32000
Fri Jul 26, 2013 2:29 pm
 
Forum: Personal Consumer Issues
Topic: Honda CRV
Replies: 10
Views: 1103

Re: Alaskan Cruise

As a lifelong Alaskan, I think Denali is a little overrated. For my money, the best 5-7 day trip in Alaska is to drive from Anchorage to Chitina (on the Copper River, about 4-5 hour drive from Anchorage), take a short scenic flight into McCarthy/Kennecott (in Wrangell-St. Elias National Park--the la...
by rjc32000
Wed Jul 10, 2013 4:05 am
 
Forum: Personal Consumer Issues
Topic: Alaskan Cruise
Replies: 27
Views: 1506

Re: Portfolio review and advice/suggestions, please

Sorry, my match/numbers/ratio is bad: I receive ~$75k salary + $65-75k distributions. So I guess closer to 55/45 or even 50/50 salary/distribution. I also do not have any deductions for health/dental/disability. I apologize for my error. Debt : $220k mortgage @ 4% Tax Rate : 28% Federal, 0% State I ...
by rjc32000
Wed Jul 03, 2013 3:25 pm
 
Forum: Investing - Help with Personal Investments
Topic: Portfolio review and advice/suggestions, please
Replies: 5
Views: 546

Re: Portfolio review and advice/suggestions, please

Thanks for your insightful reply, FFL. You are correct that I'd likely sell my current home when I bought another. I'm embarrassed to admit that I hadn't actually broken down the finances of my options as plainly and simply as you did, and that really helps makes the correct course of action clear. ...
by rjc32000
Wed Jul 03, 2013 12:25 pm
 
Forum: Investing - Help with Personal Investments
Topic: Portfolio review and advice/suggestions, please
Replies: 5
Views: 546

Portfolio review and advice/suggestions, please

Emergency funds : Yes. Held in (relatively) high interest savings account (1%) Debt : $220k mortgage @ 4% (30 year, and I'm currently paying MIP of ~$200/mo until I'm down to ~ $180k principal), $280/mo student loan payments (2.1%), $550/mo car lease payments T ax Filing Status : Single Tax Rate : ...
by rjc32000
Tue Jul 02, 2013 5:03 pm
 
Forum: Investing - Help with Personal Investments
Topic: Portfolio review and advice/suggestions, please
Replies: 5
Views: 546

Re: Exchange to Admiral shares in taxable account: Owe taxes

Thanks again for all the assistance/suggestions. I bought approx $4k of Total Stk Indx Investor shares from money market account yesterday, which brought my total up to ~$12k. This morning when I logged into Vanguard and checked "balances and holdings" there was a little yellow button in m...
by rjc32000
Tue Jul 02, 2013 1:41 pm
 
Forum: Personal Finance (Not Investing)
Topic: Exchange to Admiral shares in taxable account: Owe taxes?
Replies: 10
Views: 1056

Re: Exchange to Admiral shares in taxable account: Owe taxes

Thanks for all the help! Sounds like Vanguard should automatically convert from Investor to Admiral when I'm across approx $11k, which I will be barring any horrible stk mrkt declines over the next few days.
by rjc32000
Mon Jul 01, 2013 3:49 pm
 
Forum: Personal Finance (Not Investing)
Topic: Exchange to Admiral shares in taxable account: Owe taxes?
Replies: 10
Views: 1056

Exchange to Admiral shares in taxable account: Owe taxes?

I hold a taxable Vanguard account. As of today, I have ~$8k in Vanguard Total Stock Mrkt, and approx $4k in money market. Both have been held for less than a year. I'd like to exchange the full amount of both into Total Stk Mrk Index Admiral shares. Are there tax implications if I do this exchange? ...
by rjc32000
Mon Jul 01, 2013 2:45 pm
 
Forum: Personal Finance (Not Investing)
Topic: Exchange to Admiral shares in taxable account: Owe taxes?
Replies: 10
Views: 1056

Re: Dry, breathable, lightweight, reasonably priced rain she

I love in south-central Alaska, and we have no shortage of wet weather. For my money, the best value in rainwear is a company called Red Ledge. The Thunderlight jacket (and the full zip pants) are great products, and are both available for under $50. They breathe well, pack up really small, and are ...
by rjc32000
Wed Jun 12, 2013 1:06 pm
 
Forum: Personal Consumer Issues
Topic: Dry, breathable, lightweight, reasonably priced rain shell
Replies: 59
Views: 3225

Re: HSA with [poor] insurance or ROTH IRA?

HSAs are pretty attractive options. Unlike a Roth, your HSA contributions will reduce your AGI (and your taxes!). Some HSA providers are fairly low cost, and have good passive investment options (HSAdminstrators, for one). Any contributions grow tax-deferred, and can be withdrawn at at time tax free...
by rjc32000
Fri May 10, 2013 5:29 pm
 
Forum: Investing - Help with Personal Investments
Topic: HSA with [poor] insurance or ROTH IRA?
Replies: 10
Views: 1215

Re: Safe Harbor 401(k) provider recommendation

If I understand correctly, you are saying that any entity that provides 401k plans can do a safe harbor 401k plan. Is this correct? Do you or others have recommendations re: who might be able to provide a good plan at low cost? I've found Lincoln Trust and employee fiduciary, which seem to fit the b...
by rjc32000
Sun Jan 13, 2013 2:28 pm
 
Forum: Personal Finance (Not Investing)
Topic: Safe Harbor 401(k) provider recommendation
Replies: 4
Views: 828

Safe Harbor 401(k) provider recommendation

I own a small business with another person. We are structured as a LLC that has elected S corp taxation. We recently hired our first employee, which makes us ineligible to continue with our existing Individual 401(k) plan through Vanguard. Our accountant strongly recommends a Safe Harbor 401(k) plan...
by rjc32000
Sat Jan 12, 2013 6:17 pm
 
Forum: Personal Finance (Not Investing)
Topic: Safe Harbor 401(k) provider recommendation
Replies: 4
Views: 828

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