Search found 428 matches

by johnanglemen
Tue Jan 31, 2017 5:07 am
Forum: Investing - Theory, News & General
Topic: Non Sufficient Funds for a Buy at Vanguard
Replies: 13
Views: 4081

Re: Non Sufficient Funds for a Buy at Vanguard

I'm confused by this thread. If it's really true that Vanguard, as a matter of policy, simply does away with any order that fails to clear due to insufficient funds in your bank account, isn't that ripe for abuse? Step 1: Submit order for $1M of VTSMX, funds to come from linked bank account via ACH....
by johnanglemen
Fri Jan 20, 2017 5:46 pm
Forum: Investing - Help with Personal Investments
Topic: Another year where Vanguard Total Stock dividends aren't 100% qualified?
Replies: 19
Views: 3539

Re: Another year where Vanguard Total Stock dividends aren't 100% qualified?

The only estimate that counts is the one that comes with the 1099. livesoft pointed out that the estimates during 2015 suggested less than 100% qualified dividends last year, but in fact all the dividends were qualified when the tax info came out. What reason do you have to believe the outcome will...
by johnanglemen
Fri Jan 20, 2017 5:44 pm
Forum: Investing - Theory, News & General
Topic: Vanguard 1099s available - Other companies just as good for sending 1099s???
Replies: 63
Views: 5331

Re: Vanguard 1099s available - Other companies just as good for sending 1099s???

Could someone who received a 1099 for Total Stock dividends let us know what % of the dividend was qualified for 2016?
by johnanglemen
Tue Jan 17, 2017 11:59 pm
Forum: Investing - Help with Personal Investments
Topic: Taking rental property "out of service" to sell it
Replies: 2
Views: 395

Re: Taking rental property "out of service" to sell it

I did not use it for personal use. However, there's also this from 527 (https://www.irs.gov/pub/irs-pdf/p527.pdf): "Vacant while listed for sale. If you sell property you held for rental purposes, you can deduct the ordinary and necessary expenses for managing, conserving, or maintaining the pr...
by johnanglemen
Tue Jan 17, 2017 11:17 pm
Forum: Investing - Help with Personal Investments
Topic: Taking rental property "out of service" to sell it
Replies: 2
Views: 395

Taking rental property "out of service" to sell it

Let's say I converted a personal residence to rental property on January 1st, 2015. On August 1, 2016, I decide to take the property "out of service" (i.e. stop renting it) in order to sell it. On December 31, 2016, I sell the property at a loss (relative to my "rental basis", i....
by johnanglemen
Fri Jan 13, 2017 5:26 am
Forum: Investing - Theory, News & General
Topic: "How CRSP index change affects Vanguard funds" (Jan 2017)
Replies: 2
Views: 635

"How CRSP index change affects Vanguard funds" (Jan 2017)

"The Center for Research in Security Prices (CRSP), whose U.S. equity indexes are used as benchmarks for several Vanguard portfolios, is changing its index reconstitution process. Starting in September 2017, the quarterly adjustments needed to reflect current market valuations will be made over...
by johnanglemen
Wed Jan 11, 2017 1:02 pm
Forum: Investing - Help with Personal Investments
Topic: Holding Admiral Shares with ML Edge
Replies: 48
Views: 4140

Re: Holding Admiral Shares with ML Edge

I believe Merrill Edge assigns a rep to your account as it's opened based on my (short) experience. A few days after opening my account I received a call from a Merrill Edge rep who wanted to make sure I'd been able to log in online, walked through the process inputting an ACAT transfer, and was ea...
by johnanglemen
Mon Jan 09, 2017 12:19 pm
Forum: Investing - Help with Personal Investments
Topic: Holding Admiral Shares with ML Edge
Replies: 48
Views: 4140

Re: Holding Admiral Shares with ML Edge

I transferred all my accounts from Vanguard to Merrill Edge and couldn't be happier. I still get to hold all my vanguard index funds and get a whole ton of other benefits on top of it. My rep has been great too. Doesn't try to sell me anything and is very responsive. I can even text him when I need...
by johnanglemen
Thu Dec 29, 2016 4:45 pm
Forum: Investing - Help with Personal Investments
Topic: Paying myself a salary for investment and tax management?
Replies: 71
Views: 4455

Re: Paying myself a salary for investment and tax management?

The primary issue is that you need a valid business to generate earned income. Paying yourself to manage your own portfolio, if it were legal, would mean that anybody could turn their investment income into earned income. Why is managing an estate different from vacuuming your own home? Then again,...
by johnanglemen
Thu Dec 29, 2016 4:28 pm
Forum: Investing - Help with Personal Investments
Topic: Paying myself a salary for investment and tax management?
Replies: 71
Views: 4455

Re: Paying myself a salary for investment and tax management?

To make the logic more clear: Today I mowed the lawn. If I hired someone to mow the lawn, I'd have to pay them, so why can't I pay myself? Tomorrow I am vacuuming. Am I allowed to pay myself for that? Why should estate planning be any different? This is the simplest and most definitive answer to th...
by johnanglemen
Thu Dec 29, 2016 4:04 pm
Forum: Investing - Help with Personal Investments
Topic: Paying myself a salary for investment and tax management?
Replies: 71
Views: 4455

Re: Paying myself a salary for investment and tax management?

To make the logic more clear: Today I mowed the lawn. If I hired someone to mow the lawn, I'd have to pay them, so why can't I pay myself? Tomorrow I am vacuuming. Am I allowed to pay myself for that? Why should estate planning be any different? This is the simplest and most definitive answer to th...
by johnanglemen
Thu Dec 29, 2016 3:03 pm
Forum: Investing - Help with Personal Investments
Topic: Paying myself a salary for investment and tax management?
Replies: 71
Views: 4455

Re: Paying myself a salary for investment and tax management?

Sounds like you've run the numbers incorrectly and/or ignored a lot of details. Let's see... Even if you could reinvest your entire sham salary in tax deferred accounts, how much do think you'd save by paying 15% extra FICA taxes to earn maybe 7% to 9% on the amount you'd be "investing" ?...
by johnanglemen
Thu Dec 29, 2016 2:49 pm
Forum: Investing - Help with Personal Investments
Topic: Paying myself a salary for investment and tax management?
Replies: 71
Views: 4455

Re: Paying myself a salary for investment and tax management?

TimeRunner wrote:At the top of the thread, OP says he's 70 years old. Trolling thread.


Never said I'm 70 anywhere.
by johnanglemen
Thu Dec 29, 2016 2:49 pm
Forum: Investing - Help with Personal Investments
Topic: Paying myself a salary for investment and tax management?
Replies: 71
Views: 4455

Re: Paying myself a salary for investment and tax management?

At the high risk of derailing this thread, I'll throw out an extremely quick set of example figures just to show that A can overtake B on the time horizon we're talking about: $100, compounding at 9.5%[1], over 80 years, then reduced by 20%[2] = $113,820.25 $60, compounding at 10%, over 80 years = ...
by johnanglemen
Thu Dec 29, 2016 2:45 pm
Forum: Investing - Help with Personal Investments
Topic: Paying myself a salary for investment and tax management?
Replies: 71
Views: 4455

Re: Paying myself a salary for investment and tax management?

You missed the income tax coming out of the second calculation when distributed. They're aftertax 401k contributions. The biggest thing is that in order to get 50k+ into a solo 401k, you are limited to 18k in self deferral. The additional amounts are considered "profit sharing" and is lim...
by johnanglemen
Thu Dec 29, 2016 2:41 pm
Forum: Investing - Help with Personal Investments
Topic: Paying myself a salary for investment and tax management?
Replies: 71
Views: 4455

Re: Paying myself a salary for investment and tax management?

Your calculations are flawed and oversimplified: First, you take 20% capital gains rate off the first calculation, but don't account for the taxes that will be owed at ordinary rates, either by you or your beneficiaries, in the second calculation. No ordinary income tax owed. Aftertax 401k contribu...
by johnanglemen
Thu Dec 29, 2016 12:01 pm
Forum: Investing - Help with Personal Investments
Topic: Paying myself a salary for investment and tax management?
Replies: 71
Views: 4455

Re: Paying myself a salary for investment and tax management?

John, Let's say you pay yourself a $100k salary for doing the work that you would have CPAs do otherwise. Now, you have to pay FICA (about 12.4%) and Medicare (about 2.5%) taxes on that - that's close to $15k. Then, you contribute $54k to the retirement accounts - that you can save income taxes on....
by johnanglemen
Thu Dec 29, 2016 10:00 am
Forum: Investing - Help with Personal Investments
Topic: Paying myself a salary for investment and tax management?
Replies: 71
Views: 4455

Re: Paying myself a salary for investment and tax management?

John, Let's say you pay yourself a $100k salary for doing the work that you would have CPAs do otherwise. Now, you have to pay FICA (about 12.4%) and Medicare (about 2.5%) taxes on that - that's close to $15k. Then, you contribute $54k to the retirement accounts - that you can save income taxes on....
by johnanglemen
Thu Dec 29, 2016 9:50 am
Forum: Investing - Help with Personal Investments
Topic: Paying myself a salary for investment and tax management?
Replies: 71
Views: 4455

Re: Paying myself a salary for investment and tax management?

Thanks to the most recent responders who addressed the question. To be clear, I will certainly consult with a professional advisor about it. But it's always helpful to go into those meetings a little informed. The reason I started thinking about this approach was that I know the IRS distinguishes be...
by johnanglemen
Thu Dec 29, 2016 9:19 am
Forum: Investing - Help with Personal Investments
Topic: Paying myself a salary for investment and tax management?
Replies: 71
Views: 4455

Re: Paying myself a salary for investment and tax management?

It would not be "meaningful" in relative terms. There isn't a lot that would be meaningful to *me* in relative terms, but it's still a large amount of money in absolute terms that would be meaningful to *other* people relative to their situations. You are not adding 60k per year to your s...
by johnanglemen
Thu Dec 29, 2016 9:05 am
Forum: Investing - Help with Personal Investments
Topic: Paying myself a salary for investment and tax management?
Replies: 71
Views: 4455

Re: Paying myself a salary for investment and tax management?

bigred77 wrote:Even if you maxed out a solo 401k you are talking about, at best, maybe 50 basis points of your portfolio being affected.

It's not worth your time to worry about this.


If I contributed $60,000 to a 401k + IRA each year, the savings over the long run would be meaningful.
by johnanglemen
Thu Dec 29, 2016 8:39 am
Forum: Investing - Help with Personal Investments
Topic: Paying myself a salary for investment and tax management?
Replies: 71
Views: 4455

Re: Paying myself a salary for investment and tax management?

Are you serious? If you have a self-employed job, then you will owe FICA/medicare taxes along with income taxes. I will say you don't need to worry about "max out retirement accounts" anymore. Not "worried" about it, and this is not a useful answer. If there are simple steps I c...
by johnanglemen
Thu Dec 29, 2016 8:33 am
Forum: Investing - Help with Personal Investments
Topic: Paying myself a salary for investment and tax management?
Replies: 71
Views: 4455

Paying myself a salary for investment and tax management?

I have a large (8 figure) portfolio of assets and spend a considerable amount of time doing things that CPAs and financial advisors would otherwise do for me: completing my tax returns; researching investment options; rebalancing and harvesting losses; securing proper insurance; maintaining legal st...
by johnanglemen
Tue Dec 27, 2016 3:51 pm
Forum: Investing - Help with Personal Investments
Topic: Take IRA deduction this year and then convert to Roth next year?
Replies: 13
Views: 1118

Re: Take IRA deduction this year and then convert to Roth next year?

I think what we are not understanding is how you can have only a few thousand dollars in earned income and be in the highest tax bracket. The asset base is sufficiently large that the dividend income places me in the highest brackets. You may be in the highest tax bracket, but that doesn't mean you...
by johnanglemen
Mon Dec 26, 2016 3:59 pm
Forum: Investing - Help with Personal Investments
Topic: Take IRA deduction this year and then convert to Roth next year?
Replies: 13
Views: 1118

Re: Take IRA deduction this year and then convert to Roth next year?

What do you gain by doing that? If tax brackets go down, you will still be in the or one of the highest brackets. Let say yours goes from 39.6% to 35%. You will have saved $253 by doing what you are thinking about. Is that significant enough to you to do the extra paperwork on your taxes? I guess i...
by johnanglemen
Mon Dec 26, 2016 3:30 pm
Forum: Investing - Help with Personal Investments
Topic: Take IRA deduction this year and then convert to Roth next year?
Replies: 13
Views: 1118

Re: Take IRA deduction this year and then convert to Roth next year?

retiredjg wrote:I think what we are not understanding is how you can have only a few thousand dollars in earned income and be in the highest tax bracket.


The asset base is sufficiently large that the dividend income places me in the highest brackets.
by johnanglemen
Mon Dec 26, 2016 3:02 pm
Forum: Investing - Help with Personal Investments
Topic: Take IRA deduction this year and then convert to Roth next year?
Replies: 13
Views: 1118

Re: Take IRA deduction this year and then convert to Roth next year?

Hmm, I seem to have sewn some confusion with my post, but I myself am confused by every single response! To address all of of the questions here: * I have some earned self-employment income from some contracting work, but I do not have an employer, and thus am not covered by a retirement plan at wor...
by johnanglemen
Mon Dec 26, 2016 5:11 am
Forum: Investing - Help with Personal Investments
Topic: Take IRA deduction this year and then convert to Roth next year?
Replies: 13
Views: 1118

Take IRA deduction this year and then convert to Roth next year?

[see my reply below for additional info] Ordinarily I make my IRA contribution right at the beginning of the year and then immediately convert it to Roth. I don't take any deduction because I'd rather have the money grow tax-free in the Roth throughout the year. This year I did not have earned incom...
by johnanglemen
Fri Dec 16, 2016 3:49 am
Forum: Investing - Help with Personal Investments
Topic: Traditional IRA account gone after "upgrading"
Replies: 3
Views: 837

Traditional IRA account gone after "upgrading"

After "upgrading" to Vanguard's new brokerage account structure, my old Traditional IRA account is nowhere to be found. It had a zero balance at time of upgrade, but it's still needed to complete a backdoor Roth contribution. Additionally, it is not listed in the Statements or Transaction ...
by johnanglemen
Fri Dec 09, 2016 7:13 pm
Forum: Investing - Help with Personal Investments
Topic: Another year where Vanguard Total Stock dividends aren't 100% qualified?
Replies: 19
Views: 3539

Re: Another year where Vanguard Total Stock dividends aren't 100% qualified?

It looks like this is indeed going to hold true. The updated Vanguard estimates now put Total Stock at 92%. This is worse than comparable broad US funds -- anyone know why? https://personal.vanguard.com/us/insigh ... /cap-gains
by johnanglemen
Wed Sep 28, 2016 9:18 pm
Forum: Investing - Help with Personal Investments
Topic: Basic question about 'interest tracing' (to determine deductibility of interest)
Replies: 2
Views: 488

Re: Basic question about 'interest tracing' (to determine deductibility of interest)

To illustrate the repayment rules, the regulations give an example similar to the following: "Taxpayer B borrows $100,000 (“Debt A”) on July 12, immediately deposits the proceeds in an account, and uses the debt proceeds to make the following expenditures on the following dates: August 31 - $4...
by johnanglemen
Fri Sep 23, 2016 8:23 pm
Forum: Investing - Theory, News & General
Topic: How can markets be efficient if home prices are higher in the spring?
Replies: 50
Views: 2366

Re: How can markets be efficient if home prices are higher in the spring?

You are confusing market efficiency with pricing. They are not the same thing. People make this mistake all the time with equity and bond markets. The Efficient Market Hypothisis is instead a simple theory. That the pricing of a security reflects all available public information. If you knew ahead ...
by johnanglemen
Fri Sep 23, 2016 7:43 pm
Forum: Investing - Theory, News & General
Topic: How can markets be efficient if home prices are higher in the spring?
Replies: 50
Views: 2366

Re: How can markets be efficient if home prices are higher in the spring?

To put it another way.... Bay Area realtors swear left and right that according to their data, homes sell for more in the springtime. If the realtors are so sure of this and their data shows it so surely, why aren't they buying in the winter and selling in the spring multitudes of houses as a side ...
by johnanglemen
Fri Sep 23, 2016 7:40 pm
Forum: Investing - Theory, News & General
Topic: How can markets be efficient if home prices are higher in the spring?
Replies: 50
Views: 2366

Re: How can markets be efficient if home prices are higher in the spring?

Do you follow the sell in May and and go away also? There's a saying about that for the stock market that some could say is rational also. I would say, stop comparing the selling of your home to the stock market for step one. I've sort of lost track of your line of reasoning in this thread, to be h...
by johnanglemen
Fri Sep 23, 2016 7:23 pm
Forum: Investing - Theory, News & General
Topic: How can markets be efficient if home prices are higher in the spring?
Replies: 50
Views: 2366

Re: How can markets be efficient if home prices are higher in the spring?

Do you follow the sell in May and and go away also? There's a saying about that for the stock market that some could say is rational also. I would say, stop comparing the selling of your home to the stock market for step one. I've sort of lost track of your line of reasoning in this thread, to be h...
by johnanglemen
Fri Sep 23, 2016 7:15 pm
Forum: Investing - Theory, News & General
Topic: How can markets be efficient if home prices are higher in the spring?
Replies: 50
Views: 2366

Re: How can markets be efficient if home prices are higher in the spring?

It just seems very fishy to me whenever anyone says "Oh, if you wait a few months, you can [statistically, historically] sell this object for more money than you could right now." Beware of the implied assumption there that the overall real estate market (unrelated to time of the year) wo...
by johnanglemen
Fri Sep 23, 2016 7:07 pm
Forum: Investing - Theory, News & General
Topic: How can markets be efficient if home prices are higher in the spring?
Replies: 50
Views: 2366

Re: How can markets be efficient if home prices are higher in the spring?

To put it another way.... Bay Area realtors swear left and right that according to their data, homes sell for more in the springtime. If the realtors are so sure of this and their data shows it so surely, why aren't they buying in the winter and selling in the spring multitudes of houses as a side ...
by johnanglemen
Fri Sep 23, 2016 6:59 pm
Forum: Investing - Theory, News & General
Topic: How can markets be efficient if home prices are higher in the spring?
Replies: 50
Views: 2366

Re: How can markets be efficient if home prices are higher in the spring?

Why isn't this being exploited? Transaction costs (closing, realtor fees, etc.) eat up a lot of the spread, and there's the risk that home prices fall while a prospective house-flipper is waiting for the seasons to change. Plus property taxes, though potentially offset by non-seasonal price increas...
by johnanglemen
Fri Sep 23, 2016 6:39 pm
Forum: Investing - Theory, News & General
Topic: How can markets be efficient if home prices are higher in the spring?
Replies: 50
Views: 2366

Re: How can markets be efficient if home prices are higher in the spring?

To give some more context here, I intend to sell my home soon, and realtors are all suggesting waiting until spring to sell it. But it's hard to convince myself that there's really a free lunch here.
by johnanglemen
Fri Sep 23, 2016 6:35 pm
Forum: Investing - Theory, News & General
Topic: How can markets be efficient if home prices are higher in the spring?
Replies: 50
Views: 2366

Re: How can markets be efficient if home prices are higher in the spring?

Uh, what? :happy I don't think the saying or theory applied to each and every market out there. But, if folks are willing to pay more in the spring than they are in the winter, that sounds pretty much like market efficiency to me. The homes are priced for what folks are willing to pay at the time. ...
by johnanglemen
Fri Sep 23, 2016 6:15 pm
Forum: Investing - Theory, News & General
Topic: How can markets be efficient if home prices are higher in the spring?
Replies: 50
Views: 2366

How can markets be efficient if home prices are higher in the spring?

Bay Area realtors swear left and right that according to their data, homes sell for more in the springtime. Why would the market allow this inefficiency to persist? Why don't middlemen just buy the properties in the winter and flip them in the spring?
by johnanglemen
Tue Sep 20, 2016 8:07 pm
Forum: Investing - Help with Personal Investments
Topic: IRA contribution limit for self-employed people with multiple businesses
Replies: 7
Views: 561

Re: IRA contribution limit for self-employed people with multiple businesses

Right, I would do the backdoor. Any thoughts on the tradeoff of paying self-employment tax now (foregoing the expense deductions) in order to stuff more into a Roth for a long time horizon? Thanks for your thoughts! Do you have at least 40 quarters of credit on social security? I believe you need a...
by johnanglemen
Tue Sep 20, 2016 7:51 pm
Forum: Investing - Help with Personal Investments
Topic: IRA contribution limit for self-employed people with multiple businesses
Replies: 7
Views: 561

Re: IRA contribution limit for self-employed people with multiple businesses

Interesting, thanks. So I have a decision to make then....should I intentionally realize a profit in order to make a Roth IRA contribution, or should I deduct the offsetting expenses and forego the Roth? From your other posts, you are very high income which means you're likely to be ineligible for ...
by johnanglemen
Tue Sep 20, 2016 7:10 pm
Forum: Investing - Help with Personal Investments
Topic: IRA contribution limit for self-employed people with multiple businesses
Replies: 7
Views: 561

Re: IRA contribution limit for self-employed people with multiple businesses

I believe you'd need to have positive net compensation on your 1040 (W2 income on 1040 line 7, Schedule C income on 1040 line 12). According to IRS Pub 590A which covers Traditional and Roth IRA, if you have a mix of W-2 salary/wage and self employed income, you do not subtract self employed loss f...
by johnanglemen
Tue Sep 20, 2016 6:46 pm
Forum: Investing - Help with Personal Investments
Topic: IRA contribution limit for self-employed people with multiple businesses
Replies: 7
Views: 561

IRA contribution limit for self-employed people with multiple businesses

My understanding is that I can contribute up to my *net* self-employment profits to my IRA, minus the deduction for 1/2 of my self-employment taxes. Is that net self-employment profit across all Schedule C's, or is it sufficient if one business has a net profit even if another has a net loss? If it'...
by johnanglemen
Wed Sep 14, 2016 4:30 am
Forum: Investing - Help with Personal Investments
Topic: Is it possible to withdraw your own cash while maintaining interest deductibility at brokers that work like this?
Replies: 14
Views: 1413

Re: Is it possible to withdraw your own cash while maintaining interest deductibility at brokers that work like this?

So there doesn't appear to be much in the way of further guidance, and none of the secondary authorities I reviewed had anything particularly enlightening. It's not related to the matter at hand, but there is an old IRS Notice (Notice 89-35, 1989-1 C.B. 675) that appears to still be in effect that ...
by johnanglemen
Tue Sep 13, 2016 5:35 am
Forum: Investing - Help with Personal Investments
Topic: When calculating potential drawdown, should you adjust stock prices by inflation?
Replies: 15
Views: 1061

Re: When calculating potential drawdown, should you adjust stock prices by inflation?

I don't really follow the logic of picking the highest price something ever had (i.e. several years ago) and basing the drop off of that point. If it were me, I'd just be using this for a very general idea of things. I'd multiply by .89 and leave it at that instead of doing anything fancy. The extr...
by johnanglemen
Tue Sep 13, 2016 4:13 am
Forum: Investing - Theory, News & General
Topic: Vanguard Brokerage cost basis problems
Replies: 14
Views: 1597

Re: Vanguard Brokerage cost basis problems

I've been fighting Vanguard Brokerage for 7 months now trying to get them to fix their cost basis and tax reporting software but to no avail and I don't know what else I can do. They admit they have a software bug but after 7 months they've been unable / unwilling to fix it (continuously lying over...
by johnanglemen
Tue Sep 13, 2016 4:04 am
Forum: Investing - Help with Personal Investments
Topic: When calculating potential drawdown, should you adjust stock prices by inflation?
Replies: 15
Views: 1061

Re: When calculating potential drawdown, should you adjust stock prices by inflation?

What is the purpose of this exercise? Are you just trying to determine how low your assets might fall in a worst-case scenario? You might just as well do the reverse, and look at the upside, as there's no way of predicting the likelihood of one or the other. And even if you are able to calculate th...

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