Search found 6830 matches

by Spirit Rider
Sat Jan 20, 2018 7:56 pm
Forum: Personal Finance (Not Investing)
Topic: Discussing a 529 with your kids
Replies: 14
Views: 426

Re: Discussing a 529 with your kids

Prior to discussing cost I will be discussing with my children the importance of choosing a marketable career path. If my kids choose a useless degree path I won't even tell them they have a 529!! :happy The kids know to get a job in a field that will pay good money. A degree in math / science with...
by Spirit Rider
Sat Jan 20, 2018 7:22 pm
Forum: Investing - Help with Personal Investments
Topic: Job offer - no 401k offered
Replies: 19
Views: 1883

Re: Job offer - no 401k offered

What did people do before defined contribution tax qualified plans were available? They saved and invested. We now have access to tax efficient index/managed funds and reduced capital gain rates. Has it ever been better than now to save and invest :?: Hmm, what did people do before 401k? Yeah, what...
by Spirit Rider
Sat Jan 20, 2018 2:00 pm
Forum: Personal Finance (Not Investing)
Topic: Age limit for TIRA contribution and Roth Conversion
Replies: 3
Views: 169

Re: Age limit for TIRA contribution and Roth Conversion

You can not make traditional IRA contributions for or after the taxable year you turn 70 1/2. Individual Retirement Arrangements (IRA) are just that. It makes very little sense to make non-deductible traditional IRA contributions and do a Roth Conversion with a large pre-tax balance. If you are stil...
by Spirit Rider
Sat Jan 20, 2018 12:58 pm
Forum: Investing - Help with Personal Investments
Topic: Annuity in SIMPLE IRA
Replies: 12
Views: 466

Re: Annuity in SIMPLE IRA

However, the FI is allowed to charge “a reasonable annual administration fee” for the transfers. Posters have not reported being charged but . . . This is a misinterpretation of IRS Notice 98-4 Q&A J-4. A DFI may charge “a reasonable annual administration fee” for all participants including those w...
by Spirit Rider
Sat Jan 20, 2018 1:08 am
Forum: Personal Finance (Not Investing)
Topic: After Tax 401K, 401a Limits
Replies: 1
Views: 201

Re: After Tax 401K, 401a Limits

What does your inclusion of 401k and 401a in the title mean. Are the two plans both 401k plans or a 401k and a 401a plan? 401a pre-tax contributions are considered mandatory contributions and are not included in the employee deferral limit. There is a separate annual addition limit (2018 = $55K) fo...
by Spirit Rider
Fri Jan 19, 2018 8:29 pm
Forum: Personal Finance (Not Investing)
Topic: Individual 529 vs Custodial (UTMA/UGMA) 529
Replies: 24
Views: 834

Re: Individual 529 vs Custodial (UTMA/UGMA) 529

While a custodian of a UTMA 529 account can never change the beneficiary or rollover assets to a new beneficiary's account. The owner of a custodial account has full control over their account after the age of and custodial termination. They can do anything a parental or third party can with an acco...
by Spirit Rider
Fri Jan 19, 2018 8:22 pm
Forum: Investing - Help with Personal Investments
Topic: Annual transfer from high-fee Simple IRA to Vanguard Traditional IRA?
Replies: 6
Views: 277

Re: Annual transfer from high-fee Simple IRA to Vanguard Traditional IRA?

Only if it is >= 2 years since the date of the first SIMPLE IRA contribution.
by Spirit Rider
Fri Jan 19, 2018 8:14 pm
Forum: Investing - Help with Personal Investments
Topic: Annuity in SIMPLE IRA
Replies: 12
Views: 466

Re: Annuity in SIMPLE IRA

If they did not provide proper notice that this was 5305-SIMPLE and you could elect to make no cost transfers to another retirement plan. This would be grounds for insisting they allow you to elect this provision even though the election period has lapsed.
by Spirit Rider
Fri Jan 19, 2018 8:03 pm
Forum: Personal Finance (Not Investing)
Topic: HSA contribution when turning 65
Replies: 3
Views: 301

Re: HSA contribution when turning 65

That is because you had eligibility for the entire year. Eligibility is based on what qualifying HDHP plan you have on the 1st of each month. In the simple case maximum contribution = maximum yearly contribution * months of eligibility / 12. Contributions can occur at any time, but must reflect the ...
by Spirit Rider
Fri Jan 19, 2018 7:52 pm
Forum: Personal Finance (Not Investing)
Topic: Backdoor Roth strategy - your thoughts
Replies: 15
Views: 1583

Re: Backdoor Roth strategy - your thoughts

It is that simple to adopt a one-participant 401k. All that is necessary is earned income as a self-employed individual engaged in a trade or business with the intent to make a profit in the current or any prior year. Consulting income would definitely apply. There is no requirement for annual contr...
by Spirit Rider
Fri Jan 19, 2018 7:23 pm
Forum: Investing - Help with Personal Investments
Topic: Annual transfer from high-fee Simple IRA to Vanguard Traditional IRA?
Replies: 6
Views: 277

Re: Annual transfer from high-fee Simple IRA to Vanguard Traditional IRA?

Yes, at a minimum. You probably would want to do a rollover now. Then at worst elect the no cost/no fee transfers for next year.

Obviously, the no cost account and no fee transfer is the best option even now if it is available.
by Spirit Rider
Fri Jan 19, 2018 11:14 am
Forum: Personal Finance (Not Investing)
Topic: Inherited IRA with basis Form 8606 TaxAct
Replies: 5
Views: 339

Re: Inherited IRA with basis Form 8606 TaxAct

The problem is that if you have basis in an inherited traditional IRA. The instructions require the writing of "Inherited IRA" on the top of the separate Form 8606 for the inherited IRA. I do not know for sure, but it is very likely that there is no provision in the e-filing data package specificati...
by Spirit Rider
Fri Jan 19, 2018 10:03 am
Forum: Personal Consumer Issues
Topic: Anyone have a whole house water filter?
Replies: 13
Views: 671

Re: Anyone have a whole house water filter?

Most mortgage lenders require well water to be tested prior to any sale. You probably should have done it even if not required. Check for any report in your closing paperwork. It is generally a good idea to test for bacteria and nitrates every year. Then have more comprehensive tests done every five...
by Spirit Rider
Thu Jan 18, 2018 10:58 pm
Forum: Investing - Help with Personal Investments
Topic: Does my rollover IRA count for pro-rata calculations?
Replies: 13
Views: 460

Re: Does my rollover IRA count for pro-rata calculations?

Also, rolling it back to an IRA would interfere with a Backdoor Roth again.

Another option is to generate some self-employment income and adopt a one-participant 401k (not Vanguard) and rollover the IRA assets there.
by Spirit Rider
Thu Jan 18, 2018 8:16 pm
Forum: Investing - Help with Personal Investments
Topic: Which tax year does a Roth conversion fall under?
Replies: 6
Views: 413

Re: Which tax year does a Roth conversion fall under?

Conversions are always taxed in the year the conversion actually happens. The extension until the next tax filing deadline is only for the contribution. They are separate and independent actions.
by Spirit Rider
Thu Jan 18, 2018 7:57 pm
Forum: Investing - Help with Personal Investments
Topic: Does my rollover IRA count for pro-rata calculations?
Replies: 13
Views: 460

Re: Does my rollover IRA count for pro-rata calculations?

Yes. All traditional IRAs are combined for this purpose. Make that all pre-tax balances in all traditional, SEP and SIMPLE IRAs. Why only pre-tax balances? What there were basis in other TIRAs? I was referring to the pre-tax balances because there generally are no non-deductible basis in SEP and SI...
by Spirit Rider
Thu Jan 18, 2018 7:52 pm
Forum: Investing - Help with Personal Investments
Topic: Annual transfer from high-fee Simple IRA to Vanguard Traditional IRA?
Replies: 6
Views: 277

Re: Annual transfer from high-fee Simple IRA to Vanguard Traditional IRA?

There are some provisions of SIMPLE IRA accounts that you should be aware of. First, you can not rollover SIMPLE IRA assets to any other accounts other than another SIMPLE IRA for two years after the date of the first contribution. The withdrawal would not eligible for rollover and any amount in exc...
by Spirit Rider
Thu Jan 18, 2018 7:16 pm
Forum: Investing - Help with Personal Investments
Topic: Does my rollover IRA count for pro-rata calculations?
Replies: 13
Views: 460

Re: Does my rollover IRA count for pro-rata calculations?

TomatoTomahto wrote:
Thu Jan 18, 2018 6:55 pm
Yes. All traditional IRAs are combined for this purpose.
Make that all pre-tax balances in all traditional, SEP and SIMPLE IRAs.
by Spirit Rider
Thu Jan 18, 2018 7:11 pm
Forum: Personal Consumer Issues
Topic: Premium gas at BJ's for Mercedes
Replies: 41
Views: 1755

Re: Premium gas at BJ's for Mercedes

I’ll say for one thing this makes me never want to buy a Mercedes. I like cars that can use gas from every station. Seems to me they would be the better engineered engines.. This is not an issue unique to Mercedes. Many automobile manufactures now advise the use top tier gasoline. In fact this can ...
by Spirit Rider
Thu Jan 18, 2018 4:01 pm
Forum: Personal Finance (Not Investing)
Topic: Individual 529 vs Custodial (UTMA/UGMA) 529
Replies: 24
Views: 834

Re: Individual 529 vs Custodial (UTMA/UGMA) 529

A UTMA 529 is clearly considered a parental asset for FAFSA purposes. I do not remember where it was reported on the Profile. Your description indicates it should be listed as a student asset. Regardless, in no case is it not reported on one or the other. So your basic idea of getting more aid is no...
by Spirit Rider
Thu Jan 18, 2018 3:47 pm
Forum: Investing - Help with Personal Investments
Topic: Solo 401k options
Replies: 7
Views: 374

Re: Solo 401k options

Vanguard has two additional disadvantages: You can not purchase Admiral Share class funds in Vanguard's Individual 401k. This adds about 0.10% to the index fund expense ratios. Vanguard's Individual 401k does not allow employee eligibility restrictions. The IRS and the other one-participant 401k pla...
by Spirit Rider
Thu Jan 18, 2018 3:27 pm
Forum: Personal Consumer Issues
Topic: Premium gas at BJ's for Mercedes
Replies: 41
Views: 1755

Re: Premium gas at BJ's for Mercedes

Yes, all the gas is the same in the sense it all comes from the same refinery and is delivered by the same tanker ship. The discount stores just buy it after it's been sitting in the distributor's tanks longer . How much longer I don't know. I'm just telling you what she said. She's their in-house ...
by Spirit Rider
Thu Jan 18, 2018 3:20 pm
Forum: Personal Finance (Not Investing)
Topic: SEP IRA and 401k (w2 and 1099) questions
Replies: 3
Views: 257

Re: SEP IRA and 401k (w2 and 1099) questions

Both 10509835 and krow36 are correct. You can only contribute 20% of your net self-employment earnings to a SEP IRA. Your net self-employment earnings = business profit - 1/2 SE tax. Business profit = 1099 income - legitimate business expenses. If you manually file your returns. Complete Schedule C ...
by Spirit Rider
Thu Jan 18, 2018 2:48 pm
Forum: Personal Finance (Not Investing)
Topic: Individual 529 vs Custodial (UTMA/UGMA) 529
Replies: 24
Views: 834

Re: Individual 529 vs Custodial (UTMA/UGMA) 529

You learned this from who? and on what financial aid forms? A UTMA 529 is also most definitely considered a parental asset for FSFSA purposes. I can't say for sure, but I have never run into a school even ones using the CSS profile treating a UTMA 529 as a student asset. I wonder is someone isn't co...
by Spirit Rider
Thu Jan 18, 2018 2:35 pm
Forum: Personal Consumer Issues
Topic: Premium gas at BJ's for Mercedes
Replies: 41
Views: 1755

Re: Premium gas at BJ's for Mercedes

She said, for what it's worth, that the discount chains buy gas from them after it has been sitting in their holding tanks for a while. The longer it sits in those holding tanks before being transferred to a tanker truck for delivery, the more condensation occurs. That's why the distributor sells i...
by Spirit Rider
Thu Jan 18, 2018 9:53 am
Forum: Personal Consumer Issues
Topic: Premium gas at BJ's for Mercedes
Replies: 41
Views: 1755

Re: Premium gas at BJ's for Mercedes

I seriously doubt that BJ's has higher percentages of water unless there has been specific problems at that specific BJ's. Sounds more like FUD to me. However, it is likely that Mercedes recommends the use of top tier gasoline. Top tier gasoline has better detergent and additive packages. Engine tea...
by Spirit Rider
Wed Jan 17, 2018 5:10 pm
Forum: Investing - Help with Personal Investments
Topic: Solo 401k options
Replies: 7
Views: 374

Re: Solo 401k options

It is relatively easy to amend a one-participant 401k plan to a new provider and then transfer the assets. Like most things with these plans it is a little more involved than an IRA trustee -> trustee transfer. However, it is not that difficult and I'm sure your providers will walk you through it.
by Spirit Rider
Tue Jan 16, 2018 11:37 am
Forum: Investing - Help with Personal Investments
Topic: 529 AND UTMA
Replies: 29
Views: 1402

Re: 529 AND UTMA

I realize it is water under the bridge, but the purpose of this forum is to inform others as well. Not to quibble, but the valid UTMA distribution determination is not essential vs non-essential, but rather parental support obligation or not. While braces may be somewhat optional, but they are not j...
by Spirit Rider
Tue Jan 16, 2018 11:19 am
Forum: Investing - Help with Personal Investments
Topic: tIRA contribution sources
Replies: 2
Views: 229

Re: tIRA contribution sources

First, to make an IRA contribution you must have compensation. Typically, this is Form W-2 box 1 Wages, less Box 11 non-qualified plans and/or self-employment income. However, foreign compensation in excess of the foreign earned income/housing exclusions does apply. The traditional IRA deduction in...
by Spirit Rider
Mon Jan 15, 2018 4:38 pm
Forum: Investing - Help with Personal Investments
Topic: 529 AND UTMA
Replies: 29
Views: 1402

Re: 529 AND UTMA

For UTMA, the first $2100 in income for 2018 is tax free. Maybe I can gift stock to the UTMA account and harvest gains to pay for non-essential child expenses. Seems more flexible than a 529 account which i can only use for school. With the new tax laws, the $2100 number could be higher. It is stil...
by Spirit Rider
Mon Jan 15, 2018 4:28 pm
Forum: Personal Finance (Not Investing)
Topic: Stats on When People Take Social Security
Replies: 168
Views: 10487

Re: Stats on When People Take Social Security

Unfortunately, I have seen many people take SS at 62 just because they could. Many of them were still working and taking SS early allowed them to live even further beyond their means. Don't even get me started on one friend with < $100K in his 401k, took an in-service withdrawal as soon as he turned...
by Spirit Rider
Mon Jan 15, 2018 4:09 pm
Forum: Investing - Help with Personal Investments
Topic: $10K as a sole proprietor; how to invest?
Replies: 12
Views: 1082

Re: $10K as a sole proprietor; how to invest?

I have used TaxAct for many years, but couldn't tell you exactly without it in front of me. You will complete the income section including self-employment income. TaxAct will enter the necessary information in Schedules C and SE to calculate the maximum contribution. I think that will probably be u...
by Spirit Rider
Mon Jan 15, 2018 12:42 am
Forum: Personal Finance (Not Investing)
Topic: Very Small Companies and HCE Tests
Replies: 3
Views: 343

Re: Very Small Companies and HCE Tests

If all employees are > 5% owners or their spouses. As ERISA Stone pointed out there is no need to use a safe harbor 401k. You can simply open a "one-participant" 401k plan. The marketing terms (solo 401k, individual 401k, etc...) for these plans are also a misnomer. They are not just for a single pa...
by Spirit Rider
Sun Jan 14, 2018 1:18 am
Forum: Personal Finance (Not Investing)
Topic: Solo 401(k)-Contributing ALL net income?
Replies: 11
Views: 979

Re: Solo 401(k)-Contributing ALL net income?

If your employee deferral is pre-tax, then the amount not deferred is unlikely to trigger withholding. However, if the employee deferral is Roth then your entire compensation is taxable. Depending on the amount of the deferral, there quite likely to be withholding required. Also, state/local income ...
by Spirit Rider
Sat Jan 13, 2018 4:38 pm
Forum: Investing - Theory, News & General
Topic: Convert to Roth IRA (After-tax 401K ==> Roth 401K ==> Roth IRA)
Replies: 9
Views: 845

Re: Convert to Roth IRA (After-tax 401K ==> Roth 401K ==> Roth IRA)

If the plan and the rollover destination are the same custodian, often you can do in-kind rollovers is the fund is a retail fund. For example many people with Fidelity or Vanguard with both their 401k and IRAs can do this and even have the rollover happen electronically. It they are separate custodi...
by Spirit Rider
Sat Jan 13, 2018 4:31 pm
Forum: Investing - Help with Personal Investments
Topic: New 529 rules -- One state plan's response
Replies: 12
Views: 1012

Re: New 529 rules -- One state plan's response

Had IC 21-9-2-19.5 copied and pasted the old definition rather than linking to it, things would have been quite different. Exactly. This is going to come down to how states worded their statutes and how many are going to revise them to include, exclude or let the chips fall as they may. Many intern...
by Spirit Rider
Sat Jan 13, 2018 4:18 pm
Forum: Personal Finance (Not Investing)
Topic: Solo 401(k)-Contributing ALL net income?
Replies: 11
Views: 979

Re: Solo 401(k)-Contributing ALL net income?

Let's take these is a different order. You absolutely can make an employee elective deferral in a one-participant 401k of up to 100% of compensation. This present no red flag to the IRS, because you are claiming the compensation, just deferring it. I and many others have done so. It is perfectly leg...
by Spirit Rider
Sat Jan 13, 2018 1:12 pm
Forum: Investing - Help with Personal Investments
Topic: Inherited retirement
Replies: 8
Views: 1532

Re: Inherited retirement

Do NOT rollover into your own IRA! Do NOT title the IRA in your own name! Title the receiving IRA properly! I understand the intent, but while the first action is an irrevocable error. A properly designated Inherited account that is incorrectly titled can be properly titled by corrective action lat...
by Spirit Rider
Sat Jan 13, 2018 1:00 pm
Forum: Personal Finance (Not Investing)
Topic: Mega Backdoor Roth: Conversion or Rollover?
Replies: 15
Views: 894

Re: Mega Backdoor Roth: Conversion or Rollover?

Since IRS Notice 2014-54 allowed split rollovers. There is never a good reason to do this by indirect rollover that would be subject to the 60 day rule.

Your should always do direct rollovers of after-tax contributions and earnings.
by Spirit Rider
Sat Jan 13, 2018 12:48 pm
Forum: Personal Finance (Not Investing)
Topic: COBRA alternative for 1 month? (it's $2,400 per month!)
Replies: 69
Views: 3348

Re: COBRA alternative for 1 month? (it's $2,400 per month!)

Even though I have great respect for dm200, I am going to have to be the Yin on this Yang. I feel as though their response on every COBRA thread represents a FUD campaign. There really are no practical risks to using COBRA for gap pending-coverage if you simply make the election and payments on time...
by Spirit Rider
Fri Jan 12, 2018 10:00 pm
Forum: Investing - Theory, News & General
Topic: Convert to Roth IRA (After-tax 401K ==> Roth 401K ==> Roth IRA)
Replies: 9
Views: 845

Re: Convert to Roth IRA (After-tax 401K ==> Roth 401K ==> Roth IRA)

RMDs are required for the year you turn 70 1/2. Just make sure you do the rollover in the year before the year you turn 70 1/2. Otherwise the RMD must occur before the rollover occurs.
by Spirit Rider
Fri Jan 12, 2018 7:47 pm
Forum: Personal Finance (Not Investing)
Topic: Mega Backdoor Roth: Conversion or Rollover?
Replies: 15
Views: 894

Re: Mega Backdoor Roth: Conversion or Rollover?

If you do a split rollover only, without doing a backdoor, do you have to report that on your tax return in the year that you do the split rollover? I do not think so because there is no taxable event but I am not sure. You report the sum of both rollovers on line 16a, write rollover next to b and ...
by Spirit Rider
Fri Jan 12, 2018 3:48 pm
Forum: Personal Finance (Not Investing)
Topic: "Medical payments" premium on Auto insurance, necessary if you have medical insurance?
Replies: 6
Views: 394

Re: "Medical payments" premium on Auto insurance, necessary if you have medical insurance?

Caution with making generalizations. This is subject to state law. One or the other (usually auto) is considered primary, but this is not universal. My state has a very specific insurance law that the policy holder may determine on an incident by incident and provider by provider basis which policy ...
by Spirit Rider
Fri Jan 12, 2018 3:33 pm
Forum: Personal Finance (Not Investing)
Topic: Pay off student loans after kid graduates?
Replies: 35
Views: 2163

Re: Pay off student loans after kid graduates?

One trick you might want to look into ASAP - Can you do a quick contribution into a 529, get a state deduction - and use that? I'm not sure that is possible or not, but something that might turn out to juice your own state tax load. I'm pretty sure you cannot use 529 money to pay off student loans....
by Spirit Rider
Fri Jan 12, 2018 3:11 pm
Forum: Personal Finance (Not Investing)
Topic: Mega Backdoor Roth: Conversion or Rollover?
Replies: 15
Views: 894

Re: Mega Backdoor Roth: Conversion or Rollover?

Yes, employee after-tax contribution earnings are subject to ordinary income tax. The best option to avoid this is a split rollover. After-tax contributions -> Roth IRA, earnings -> traditional IRA. Of course this doesn't work if you are also doing a backdoor Roth. If this is true you have two possi...
by Spirit Rider
Fri Jan 12, 2018 2:56 pm
Forum: Personal Finance (Not Investing)
Topic: Failure to Defer 401k Contributions
Replies: 6
Views: 437

Re: Failure to Defer 401k Contributions

t60 is correct. IRS regulations allow the employer reasonable administrative timelines. In fact a company is not required to allow a change in election more than once a year.

Lesson learned, move on.
by Spirit Rider
Fri Jan 12, 2018 2:49 pm
Forum: Investing - Help with Personal Investments
Topic: Contributed to Roth, meant to do IRA
Replies: 7
Views: 466

Re: Contributed to Roth, meant to do IRA

DarkHelmetII is correct. The tax reform only removed the ability to recharacterize Roth Conversions. You are still freely able to recharacterize between IRA types. If we are both wrong your custodian would not let you do it if it wasn't allowed. Why not call them.
by Spirit Rider
Fri Jan 12, 2018 2:24 pm
Forum: Investing - Help with Personal Investments
Topic: Any reason to use employer 401k vs. Individual 401k?
Replies: 5
Views: 420

Re: Any reason to use employer 401k vs. Individual 401k?

It depends on what you mean by front load. Unlike an IRA, you can not make lump sum contributions to a one-participant 401k until you have the compensation available. Employee elective deferrals can only be up to 100% of compensation not already received. If your tax status is that of an S-Corp, you...
by Spirit Rider
Fri Jan 12, 2018 1:45 pm
Forum: Investing - Help with Personal Investments
Topic: What to do when SEP IRA is only option?
Replies: 11
Views: 605

Re: What to do when SEP IRA is only option?

For the self-employed the 25% of compensation is calculated as 20% of net self-employment earnings = business profit - 1/2 SE tax.
by Spirit Rider
Fri Jan 12, 2018 10:44 am
Forum: Investing - Help with Personal Investments
Topic: What to do when SEP IRA is only option?
Replies: 11
Views: 605

Re: What to do when SEP IRA is only option?

The annual addition limit ($55K) is separate for each unrelated employer. Not that it matters in this case, but she could receive $55K from her employer and still contribute $55K to a one-participant 401k. It is only the deferral limit that is across all SARSEP IRA, SIMPLE IRA, 401k and 403b. Since ...