Search found 5024 matches

by PouyaVakilian
Tue Oct 24, 2023 2:35 pm
Forum: Personal Finance (Not Investing)
Topic: Solo 401K - Do I need separate EIN from my business EIN
Replies: 3
Views: 737

Solo 401K - Do I need separate EIN from my business EIN

I've been thoroughly confused with Vanguard Solo 401K EIN situation.
I am self employed and have an S corporation with its dedicated EIN. I'm trying to open a solo 401K account with Vanguard.
Can I open my solo 401K account and file it using my business EIN or do I need to create a separate EIN for the Solo 401K?


I've seen conflicting information online. Would appreciate it if anyone c an help
by Deputy Dawg
Fri Jun 16, 2023 7:05 pm
Forum: Personal Investments
Topic: Brokerage Account Transfer In Kind to Wife
Replies: 2
Views: 377

Re: Brokerage Account Transfer In Kind to Wife

montanagirl wrote: Fri Jun 16, 2023 7:03 pm I don't think there's any limit to the tax free gifts you can make to a spouse.

If you're shifting assets to avoid collection that's a different matter.
Thanks, not doing anything shady, just keeping separate finances moving forward.

Dawg
by Deputy Dawg
Fri Jun 16, 2023 6:50 pm
Forum: Personal Investments
Topic: Brokerage Account Transfer In Kind to Wife
Replies: 2
Views: 377

Brokerage Account Transfer In Kind to Wife

Hi folks,

I have a brokerage account in my name only and I'd like to transfer half of the assets to my wife's brokerage account (in her name only). Can I do this without triggering a tax event?

Thanks,

Dawg
by Deputy Dawg
Thu Jun 15, 2023 10:24 pm
Forum: Personal Finance (Not Investing)
Topic: Recent job change and need for immediate renegotation
Replies: 52
Views: 5461

Re: Recent job change and need for immediate renegotation

Congrats OP, it’s gotta feel good taking action and seeing where you stand. Hope you get the response you desire but, if not, you’ve gained valuable experience you can use in your next move. Win-Win.
by Deputy Dawg
Thu Jun 15, 2023 8:25 pm
Forum: Personal Investments
Topic: First Time Financial Evaluation
Replies: 7
Views: 1362

Re: First Time Financial Evaluation

My only thought is that it’s been a helluva decade! Congrats! 😀
by Deputy Dawg
Wed Jun 14, 2023 2:27 pm
Forum: Personal Investments
Topic: Portfolio review, 3 and 9 years out
Replies: 7
Views: 1049

Re: Portfolio review, 3 and 9 years out

I think, if you want to retire now, you can and should. Those thousand other things you’d rather be doing will only get more elusive as time goes on. Or, if you’re like me, the list will only keep getting longer. Life is good! For something more actionable, I’d like to see what your total income in retirement is expected to be for your pensions and social security. I didn’t see those totals listed. From there you could give us an idea of how much you’d need to withdraw from your retirement accounts to meet your $160k/yr spending requirements. Also, it doesn’t appear that you have heirs so you may have the ability to draw more from your investments than the traditional 4% rule or other methods would allow for. Hi Dawg. Yeah, between Social ...
by Deputy Dawg
Wed Jun 14, 2023 1:33 pm
Forum: Personal Investments
Topic: Portfolio review, 3 and 9 years out
Replies: 7
Views: 1049

Re: Portfolio review, 3 and 9 years out

I think, if you want to retire now, you can and should. Those thousand other things you’d rather be doing will only get more elusive as time goes on. Or, if you’re like me, the list will only keep getting longer. Life is good!

For something more actionable, I’d like to see what your total income in retirement is expected to be for your pensions and social security. I didn’t see those totals listed. From there you could give us an idea of how much you’d need to withdraw from your retirement accounts to meet your $160k/yr spending requirements.

Also, it doesn’t appear that you have heirs so you may have the ability to draw more from your investments than the traditional 4% rule or other methods would allow for.
by samsmith
Thu Mar 23, 2023 10:32 pm
Forum: Personal Investments
Topic: Gifting Brokerage Account
Replies: 32
Views: 2789

Re: Gifting Brokerage Account

As others have said, it is not clear exactly what the original poster is trying to accomplish. It does feel like we are not getting the entire story. My assumption was that the plan was going to be to gift assets to his parent(s) and then presumably inherit the assets back in the future (that is why OP is so sure that the gifted assets would not be sold). Anyway that was my assumption. The concept would have been that he would gift appreciated assets and then inherit them with a stepped up basis. But if the assets have an unrealized loss, this entire "plan" is complicated and makes no sense. As someone else said, if the assets really have an unrealized loss, then just sell them and gift the cash. That would allow the original post...
by samsmith
Thu Feb 16, 2023 9:34 pm
Forum: Personal Finance (Not Investing)
Topic: Estate Planning
Replies: 22
Views: 2982

Re: Estate Planning

You can certainly get more opinions, but 2 revocable trusts is pretty "standard" for IL estate planning. Make sure you understand the difference between avoiding probate (which entails passing assets outside the will - think IRAs with beneficiary designations, joint accounts, revocable trusts) and minimizing IL state estate tax (which is a different thing - you can have a zero probate estate but still easily have a taxable estate on which taxes would be owed). As an example, if your only asset was $5 Million in an IRA with your only child as the IRA beneficiary - you would have no assets going through probate. But you would have a taxable estate in IL and owe several hundreds of thousands dollars to IL for estate tax. The point of...
by samsmith
Wed Dec 07, 2022 11:36 pm
Forum: Personal Finance (Not Investing)
Topic: Inherited IRA RMD
Replies: 8
Views: 1130

Re: Inherited IRA RMD

I believe the IRS has been confusing on this point. I believe the Secure Act passed in 2019 and would have taken effect for deaths after 1/1/2020. This eliminated the "IRA stretch" for most inherited IRAs. But Covid special rules meant no RMDs were required in 2020. For 2021 and beyond, if you inherited an IRA and you fell into the 10-year rule category - pretty much everyone assumed that RMDs would not apply, but you would have to take all the assets out of the IRA by 10 years. I think the IRS even suggested that. So many people did not take distributions from inherited IRAs in 2021 thinking they were not necessary. Anyway, I believe the IRS in early 2022, in a proposed rule, said RMDs were required for inherited IRAs. This would...
by samsmith
Sun Dec 04, 2022 5:39 pm
Forum: Personal Investments
Topic: Irrevocable Trust Distribution Question
Replies: 5
Views: 858

Re: Irrevocable Trust Distribution Question

That would work.
by dn123
Sat Aug 06, 2022 5:37 am
Forum: Personal Investments
Topic: Total Stock Index without dividends exist?
Replies: 25
Views: 2698

Re: Total Stock Index without dividends exist?

Meb Fabor (of Cambria Funds) did a podcast in which he discussed creating an index tracking fund composed of non dividend yielding stocks, probably for the same reason you are concerned (tax drag of divs). I think it was this episode, https://mebfaber.com/2016/11/09/episode ... dividends/ with Swedroe.
by Deputy Dawg
Mon Jun 13, 2022 2:03 pm
Forum: Personal Consumer Issues
Topic: No car for the past 5 years. Thinking of buying. Need advice
Replies: 32
Views: 3106

Re: No car for the past 5 years. Thinking of buying. Need advice

This might seem strange but depending on how long each of your rental periods are for and how many miles you drive you may want to rent a truck/van from U-Haul. They charge $20/day plus mileage, you can reserve and pick up and drop off 24/7 from their app. I recently moved and needed to rent a truck for a short period, couldn’t have been easier and certainly cheaper than standard rental car companies.
by Tesla
Fri May 06, 2022 3:32 pm
Forum: Personal Consumer Issues
Topic: Dyson Fans
Replies: 8
Views: 1315

Re: Dyson Fans

As noted above, Dyson products in general are overpriced and lower performing. But man, they are GREAT at design and marketing. I personally don't want fans littering my house on the floor either way, but as noted - a cheap, "normal" fan is going to outperform and cost less. Don't know your room - but do you have a good ceiling fan? These accomplish most of what you want. You can easily swap out a light with a fan and it is going to dramatically cool the room. The other option if you're wanting to get creative that I don't see people do much any more is a whole house fan. I lived with a guy who had one and it was awesome. I'm surprised they never took off. Lastly, there is a level of controversy on this - but you can run your fur...
by Tesla
Fri May 06, 2022 2:31 pm
Forum: Personal Consumer Issues
Topic: Dyson Fans
Replies: 8
Views: 1315

Re: Dyson Fans

Thanks for all the input! I went ahead and bought refurbished which was significantly less cost vs the latest models. We’ll see how it goes. There’s a 30 day return policy if I don’t like it. Seems like most reviewers are happy with their purchase.
by Tesla
Fri May 06, 2022 11:46 am
Forum: Personal Consumer Issues
Topic: Dyson Fans
Replies: 8
Views: 1315

Re: Dyson Fans

Thanks. I was looking for first hand experience. I’m going to give one a try. There’s some decent deals out there and I like the air purifier capability.
by Tesla
Thu May 05, 2022 4:26 pm
Forum: Personal Consumer Issues
Topic: Dyson Fans
Replies: 8
Views: 1315

Dyson Fans

We have a large home but much time is spent in a 350 square foot area. Looking mainly to reduce my heating and cooling bill. Cooling is fan only from what I read.

Are they worth it? Model suggestions?
by Tesla
Tue May 03, 2022 3:03 pm
Forum: Personal Finance (Not Investing)
Topic: Disinherit a Child
Replies: 71
Views: 11796

Disinherit a Child

I’m looking for options to prevent my child from getting an inheritance. I was thinking of removing them as a beneficiary from all accounts but see that children are in line after both spouses pass by going through probate. I haven’t setup a living revocable trust so probably need to make that a priority. Are there other options even in the short term until a trust is set up?
by Tesla
Sat Apr 23, 2022 10:17 am
Forum: Personal Investments
Topic: Retirement Mistakes
Replies: 115
Views: 29080

Re: Retirement Mistakes

For Roth conversions supporters (@Tesla @ByThePond and others), have you modeled the net worth impact at end of plan (demise of the estate holder) of Roth vs no-Roth scenarios? What was the difference, if any, measured in dollars or percentage? My modeling shows with no Roth conversions and SS + RMDs kicking in I’m going to be in a high tax bracket and every year beyond that it gets worse. So high taxes starting at 72 for the rest of my life. The situation is worse if my spouse or I passes since the MFJ goes away. The other impact is high IRMAA. The alternative is to take my 22% hit now (covers federal and state) and forever be in the lowest bracket and lowest IRMAA. I’m doing conversions to the max of the 24% bracket to get the majority o...
by Cyclone
Sat Apr 23, 2022 12:50 am
Forum: Personal Consumer Issues
Topic: Vacation in Hawaii
Replies: 32
Views: 4284

Re: Vacation in Hawaii

Oahu isn't one giant city, not even close. It's very possible to stay in a resort that's away from the urban area yet still accessible, such as the Four Seasons in the west or the Turtle Bay Resort in the north. That way you can just hang around the hotel if you want or go into "town" and see any sights in which you have an interest.

So far I've been to Oahu, Kauai, and the Big Island. It's really hard to make a mistake - all have been among my most enjoyable vacations.
by Tesla
Tue Apr 19, 2022 7:45 am
Forum: Personal Investments
Topic: Retirement Mistakes
Replies: 115
Views: 29080

Re: Retirement Mistakes

For Roth conversions supporters (@Tesla @ByThePond and others), have you modeled the net worth impact at end of plan (demise of the estate holder) of Roth vs no-Roth scenarios? What was the difference, if any, measured in dollars or percentage? My modeling shows with no Roth conversions and SS + RMDs kicking in I’m going to be in a high tax bracket and every year beyond that it gets worse. So high taxes starting at 72 for the rest of my life. The situation is worse if my spouse or I passes since the MFJ goes away. The other impact is high IRMAA. The alternative is to take my 22% hit now (covers federal and state) and forever be in the lowest bracket and lowest IRMAA. I’m doing conversions to the max of the 24% bracket to get the majority o...
by Tesla
Thu Apr 14, 2022 4:37 pm
Forum: Personal Finance (Not Investing)
Topic: Auto dealer removed window sticker for negotiations
Replies: 101
Views: 12608

Re: Auto dealer removed window sticker for negotiations

May be worth contacting the GM and tell them how disappointed you are in how they do business. You never know what they may do until you try.
by Tesla
Fri Apr 08, 2022 4:39 pm
Forum: Personal Finance (Not Investing)
Topic: Need Help Choosing Medigap Provider
Replies: 11
Views: 1405

Re: Need Help Choosing Medigap Provider

JoeRetire wrote: Fri Apr 08, 2022 4:02 pm Didn't the SHIP counselor go over this with you and help you choose a plan?

Remember, plans are state-specific (and sometimes county-specific). My United Health Care plan will not be the same cost as yours, unless you happen
to live where I live.

We chose United Health Care for our Medicare Advantage plan. But it had nothing to do with being endorsed by AARP.
No. Ship counselor explained about Medicare plans, Medigap and Medicare Advantage, and told us where to look up rates. They did not help us choose a company for our Medigap coverage.
by Tesla
Fri Apr 08, 2022 4:38 pm
Forum: Personal Finance (Not Investing)
Topic: Need Help Choosing Medigap Provider
Replies: 11
Views: 1405

Re: Need Help Choosing Medigap Provider

Duplicate.
by Tesla
Fri Apr 08, 2022 3:14 pm
Forum: Personal Finance (Not Investing)
Topic: Need Help Choosing Medigap Provider
Replies: 11
Views: 1405

Re: Need Help Choosing Medigap Provider

Thank you for all the input! We have decided on Medigap and Plan G. For our situation we feel that's the best option. Yes, highly recommend Boomer Benefits and the idea of using a broker. The key is getting the proper “letter of coverage” and then look at the company’s that are available. They all have to meet the same requirements so price is a key factor. Look at how stable their rate history has been. I filled out info at Boomer Benefits and they called me. In my state the link SHIIP gave us shows around 40 companies. Boomer Benefits has 4 companies. So limited choices but could be quality over quantity. They don't have UHC or Blue Cross on their list for example. First, a general comment on lists comparing premiums, based on my own expe...
by Tesla
Fri Apr 08, 2022 11:27 am
Forum: Personal Finance (Not Investing)
Topic: Need Help Choosing Medigap Provider
Replies: 11
Views: 1405

Need Help Choosing Medigap Provider

Hi. My wife is going on Medicare soon and we need to pick a Medigap provider. We met with Ship counselor a while back and decided on Plan G. I have Medigap listings for my state that shows the company name and monthly premium. That's helpful but there's more that I'm looking for such as: 1. Which Policy Type - Attained Age vs Issue Age vs No Age. These are the 3 types listed in my state. My wife suggested United Health Care because of AARP endorsement. United Health Care is listed under "No Age" policies and is almost double the rate of the lowest price "Attained Age" policy. 2. Quality of the company. Are they easy to get in touch with, will they be around in a few years. 3. Rates as my wife ages. 4. Coverage if moving ...
by Tesla
Tue Apr 05, 2022 1:52 pm
Forum: Personal Investments
Topic: Retirement Mistakes
Replies: 115
Views: 29080

Re: Retirement Mistakes

One other mistake I was ready to make - paying for my Roth conversion taxes with tIRA money. Instead I will use my taxable account.
My goal now is to get as much as possible in the Roth and let it grow. I may leave some amount in tIRA for LTC and QCD. I need to understand LTC better but have time to figure that out.
by Tesla
Tue Apr 05, 2022 9:42 am
Forum: Personal Investments
Topic: Mortgage Payoff/Pursue Other Options
Replies: 49
Views: 5305

Re: Mortgage Payoff/Pursue Other Options

I think your instincts are right...pay off the mortgage. I hear the age old argument of the tax deduction....I don't buy it. Pay the bank $100, so you don't have to pay the government $25-$30? Sure, its a low interest. So? You are paying the bank money you don't have to pay the bank in hopes that you will make the difference up by returns on that difference. Even if you play that game......it's pennies and not how wealth is created. Paying off your mortgage frees up your cash flow and you can invest that much more going forward. This post will get hate! Bring it My largest growth in wealth happened after I paid off my mortgage. There’s also a feeling of freedom that’s hard to describe. Putting all that money that was going to the bank into...
by Tesla
Mon Apr 04, 2022 9:43 pm
Forum: Personal Investments
Topic: Retirement Mistakes
Replies: 115
Views: 29080

Re: Retirement Mistakes

For Roth conversions supporters (@Tesla @ByThePond and others), have you modeled the net worth impact at end of plan (demise of the estate holder) of Roth vs no-Roth scenarios? What was the difference, if any, measured in dollars or percentage? My modeling shows with no Roth conversions and SS + RMDs kicking in I’m going to be in a high tax bracket and every year beyond that it gets worse. So high taxes starting at 72 for the rest of my life. The situation is worse if my spouse or I passes since the MFJ goes away. The other impact is high IRMAA. The alternative is to take my 22% hit now (covers federal and state) and forever be in the lowest bracket and lowest IRMAA. I’m doing conversions to the max of the 24% bracket to get the majority o...
by Tesla
Sun Apr 03, 2022 8:35 pm
Forum: Personal Investments
Topic: Backdoor Roth Pro Rata Rule
Replies: 41
Views: 3177

Re: Backdoor Roth Pro Rata Rule

If you are projecting out 15 years, chances are you plan to convert your entire tax-deferred account. That is not necessary and may even cost you something. I'm trying to understand more if it's worth it to convert the entire tax-deferred account. Even with a small RMD it pushes me to higher IRMAA tier starting at 70 projecting with today's dollars. Social Security around $73K, Tax Free Bond income around $106K, plus other interest from savings. So it appears you will be paying some IRMAA no matter what. The question is how much. And when. That's OK. IRMAA is not designed to make you pay more...it is designed to allow less fortunate people pay less. You don't need the subsidy as much as some. And even with IRMAA, you are not paying the ful...
by Tesla
Sun Apr 03, 2022 1:08 pm
Forum: Personal Investments
Topic: Backdoor Roth Pro Rata Rule
Replies: 41
Views: 3177

Re: Backdoor Roth Pro Rata Rule

If you are projecting out 15 years, chances are you plan to convert your entire tax-deferred account. That is not necessary and may even cost you something. I'm trying to understand more if it's worth it to convert the entire tax-deferred account. Even with a small RMD it pushes me to higher IRMAA tier starting at 70 projecting with today's dollars. Social Security around $73K, Tax Free Bond income around $106K, plus other interest from savings. The primary purpose of the conversions should be to keep your RMDs reasonable instead of really big (pushing you into higher brackets than while working). Getting your tax-deferred accounts under $1 million should do that for a couple, maybe $400k -$500k for a single person. Seems like I should at ...
by Tesla
Sun Apr 03, 2022 1:06 pm
Forum: Personal Investments
Topic: Backdoor Roth Pro Rata Rule
Replies: 41
Views: 3177

Re: Backdoor Roth Pro Rata Rule

Deleted duplicate
by Tesla
Sun Apr 03, 2022 1:04 pm
Forum: Personal Investments
Topic: Backdoor Roth Pro Rata Rule
Replies: 41
Views: 3177

Re: Backdoor Roth Pro Rata Rule

Deleted duplicate
by Tesla
Sat Apr 02, 2022 10:06 pm
Forum: Personal Investments
Topic: Retirement Mistakes
Replies: 115
Views: 29080

Re: Retirement Mistakes

RudyS wrote: Sat Apr 02, 2022 1:17 pm I'm 85 with more than enough assets for the rest of our lives and a decent legacy (hopefully). My biggest mistake was not doing Roth conversions as soon as it became possible. I would not have missed the tax hit, but now am faced with big RMDs and the IRMAA cliffs.
There seemed to have been a "conventional wisdom" that one's tax burden will be lower after retirement. Not true (at least not always). Even worse for a widow/widower.
Thanks for this post! I’m newly retired and have been spending time looking at conversions. I did budget for conversions but see that I need to be much more aggressive then planned to get RMDs down to a reasonable amount. It’s a stretch in the budget right now but seems like it will be worth it.
by Tesla
Sat Apr 02, 2022 9:33 pm
Forum: Personal Investments
Topic: Backdoor Roth Pro Rata Rule
Replies: 41
Views: 3177

Re: Backdoor Roth Pro Rata Rule

Don’t forget that it is the age 72 balance that will determine your first RMD, not today’s balance. The $1.5M IRA will continue to grow, even if you are withdrawing from it. Yes. At $100k conversion per year the balance doesn’t move. That’s why I’m stretching to do $150k conversion per year. It’s not something I budgeted for but see the need. Note that your Roth should contain only stocks and all your bonds should be in the tIRA. The Roth will then grow at a faster rate than the tIRA. My tIRA is all bonds. Roth will have all equities. I have been a bond investor my whole life. I see the need for equities especially now with high inflation. IRMAA doesn’t impact you until the year you turn 63 (since you will turn 65 two years later, which is...
by Tesla
Fri Apr 01, 2022 7:47 pm
Forum: Personal Investments
Topic: Backdoor Roth Pro Rata Rule
Replies: 41
Views: 3177

Re: Backdoor Roth Pro Rata Rule

I didn't know about QCDs. Thanks for that. I'll definitely keep it in mind. I learn something new everyday here.
by Tesla
Fri Apr 01, 2022 7:18 pm
Forum: Personal Investments
Topic: Backdoor Roth Pro Rata Rule
Replies: 41
Views: 3177

Re: Backdoor Roth Pro Rata Rule

It may seem like a hassle but you will most likely end up with more money because it is mostly likely being taxed at a lower rate than while working. If you are projecting out 15 years, chances are you plan to convert your entire tax-deferred account. That is not necessary and may even cost you something. The primary purpose of the conversions should be to keep your RMDs reasonable instead of really big (pushing you into higher brackets than while working). Getting your tax-deferred accounts under $1 million should do that for a couple, maybe $400k -$500k for a single person. If there comes a time in your life when medical bills are very high (this includes long term care), you can use the residual tax-deferred account to pay for the bills...
by Tesla
Fri Apr 01, 2022 2:20 pm
Forum: Personal Investments
Topic: Backdoor Roth Pro Rata Rule
Replies: 41
Views: 3177

Re: Backdoor Roth Pro Rata Rule

retiredjg wrote: Fri Apr 01, 2022 12:58 pm Consider going up just to the IRMAA tier...which is somewhat lower than the top of the 22% bracket. I don't think you accomplish much of a conversion for the extra IRMAA cost.
I’ve given up with IRMAA. Like someone pointed out earlier in the thread IRMAA is unknown 2 years from now. I’ve run some numbers and even being aggressive with conversions it’s going to take almost 15 years. In retrospective I should have invested in Roth 401k when the chance was there. This is a major expense to convert at this point in my life.
by Tesla
Fri Apr 01, 2022 12:18 pm
Forum: Personal Investments
Topic: Backdoor Roth Pro Rata Rule
Replies: 41
Views: 3177

Re: Backdoor Roth Pro Rata Rule

Have you estimated your age 72 IRA values and future RMDs? What will your taxes be like then? (This is rhetorical—no need to respond here. I just don’t want you to be surprised down the road when you currently have a chance to be pro-active.) I have and the IRA value doesn’t change much based on estimated conversions. With conversions I’m trying to stay mostly in the 12% tax bracket and keep IRMAA down. Conversions get expensive beyond that. You aren’t converting very much if you trying to stay in the 12% tax bracket. What matters is what tax bracket you will be in when you take RMDs at age 72. Maybe you will stay in the 12% tax bracket or maybe you won’t. It is best to figure this out now, while you have a chance to modify your plan. To h...
by Tesla
Thu Mar 31, 2022 6:46 pm
Forum: Personal Investments
Topic: Backdoor Roth Pro Rata Rule
Replies: 41
Views: 3177

Re: Backdoor Roth Pro Rata Rule

Eagle33 wrote: Thu Mar 31, 2022 6:00 pm
Tesla wrote: Wed Mar 30, 2022 7:26 pm Yep, understand. Staying at $228k MAGI keeps IRMAA at $238.10.
You probably are aware that 2022 MAGI is used to determine your 2024 IRMAA, not this year's IRMAA. This article currently titled 2022 2023 Medicare Part B IRMAA Premium Brackets is updated periodically by the author and probably will re-title to 2023 2024 in Sept. or Oct. with his estimates for 2024 IRMAA.
Thanks for the reminder and link. Great info.
by Tesla
Wed Mar 30, 2022 7:26 pm
Forum: Personal Investments
Topic: Backdoor Roth Pro Rata Rule
Replies: 41
Views: 3177

Re: Backdoor Roth Pro Rata Rule

Thanks, I’ll take a look. This year I converted $100k. This keeps me just below $228k MAGI. At this rate RMD at 72 will be around $56k. To covert another $50k for example would cost ~$15k more in taxes and IRMAA. This doesn’t look like the 12% tax bracket at all unless there is huge non-taxable interest added to your AGI or you itemize large amounts. For 2021, the 12% tax bracket ended up at $40,525 of Taxable Income for Singles and $81,050 for MFJ. https://taxfoundation.org/2021-tax-brackets/ Use your Taxable Income number to lookup where you land in the first table. I have non-taxable interest coming from municipal bonds. That helps for your taxable income, but tax exempt interest is included in the MAGI for IRMAA. You may not have dodge...
by Tesla
Wed Mar 30, 2022 1:57 pm
Forum: Personal Investments
Topic: Backdoor Roth Pro Rata Rule
Replies: 41
Views: 3177

Re: Backdoor Roth Pro Rata Rule

celia wrote: Wed Mar 30, 2022 1:37 pm
Tesla wrote: Tue Mar 29, 2022 6:40 pm Thanks, I’ll take a look. This year I converted $100k. This keeps me just below $228k MAGI. At this rate RMD at 72 will be around $56k. To covert another $50k for example would cost ~$15k more in taxes and IRMAA.
This doesn’t look like the 12% tax bracket at all unless there is huge non-taxable interest added to your AGI or you itemize large amounts.

For 2021, the 12% tax bracket ended up at $40,525 of Taxable Income for Singles and $81,050 for MFJ.

https://taxfoundation.org/2021-tax-brackets/
Use your Taxable Income number to lookup where you land in the first table.
I have non-taxable interest coming from municipal bonds.
by Tesla
Tue Mar 29, 2022 10:36 pm
Forum: Personal Consumer Issues
Topic: Waiting lists for EV SUVs
Replies: 131
Views: 14913

Re: Waiting lists for EV SUVs

I love my Tesla. 2 1/2 years so far with zero maintenance. I’ve been to the dealership once for a recall. It took 2 minutes. Best car I have driven by far in my 44 years of driving.
by Tesla
Tue Mar 29, 2022 6:40 pm
Forum: Personal Investments
Topic: Backdoor Roth Pro Rata Rule
Replies: 41
Views: 3177

Re: Backdoor Roth Pro Rata Rule

Have you estimated your age 72 IRA values and future RMDs? What will your taxes be like then? (This is rhetorical—no need to respond here. I just don’t want you to be surprised down the road when you currently have a chance to be pro-active.) I have and the IRA value doesn’t change much based on estimated conversions. With conversions I’m trying to stay mostly in the 12% tax bracket and keep IRMAA down. Conversions get expensive beyond that. You aren’t converting very much if you trying to stay in the 12% tax bracket. What matters is what tax bracket you will be in when you take RMDs at age 72. Maybe you will stay in the 12% tax bracket or maybe you won’t. It is best to figure this out now, while you have a chance to modify your plan. To h...
by Tesla
Tue Mar 29, 2022 5:16 pm
Forum: Personal Investments
Topic: Backdoor Roth Pro Rata Rule
Replies: 41
Views: 3177

Re: Backdoor Roth Pro Rata Rule

retiredjg wrote: Tue Mar 29, 2022 4:21 pm It takes a village.... :happy
This community is amazing. I’m learning something new every day here.
by Tesla
Tue Mar 29, 2022 12:16 pm
Forum: Personal Investments
Topic: Backdoor Roth Pro Rata Rule
Replies: 41
Views: 3177

Re: Backdoor Roth Pro Rata Rule

MrJedi wrote: Tue Mar 29, 2022 10:28 am
Tesla wrote: Tue Mar 29, 2022 9:59 am
retiredjg wrote: Tue Mar 29, 2022 9:37 am Ah...If you had income this year, you might be eligible to contribute directly to Roth IRA (one for you and spouse as well). Have you considered that?
With earned income, Roth conversions, and bond income I’m over the MAGI limit.
Income resulting from Roth conversion is not counted in your Roth IRA MAGI. It is one of the modifications on AGI that calculate into the Roth IRA MAGI.
Thank you! With that I am eligible.
by Tesla
Tue Mar 29, 2022 10:21 am
Forum: Personal Investments
Topic: Backdoor Roth Pro Rata Rule
Replies: 41
Views: 3177

Re: Backdoor Roth Pro Rata Rule

Thanks. I retired in earlier this year. I’ll be doing Roth conversions for next few years, probably until RMDs kick in. Be sure to first convert the funds/ETFs that are expected to grow the fastest, to maximize future tax-free growth. And try to convert more than the yearly growth in your IRAs else the IRAs will continue to grow larger each year. Have you estimated your age 72 IRA values and future RMDs? What will your taxes be like then? (This is rhetorical—no need to respond here. I just don’t want you to be surprised down the road when you currently have a chance to be pro-active.) I have and the IRA value doesn’t change much based on estimated conversions. With conversions I’m trying to stay mostly in the 12% tax bracket and keep IRMAA...
by Tesla
Tue Mar 29, 2022 9:59 am
Forum: Personal Investments
Topic: Backdoor Roth Pro Rata Rule
Replies: 41
Views: 3177

Re: Backdoor Roth Pro Rata Rule

retiredjg wrote: Tue Mar 29, 2022 9:37 am Ah...If you had income this year, you might be eligible to contribute directly to Roth IRA (one for you and spouse as well). Have you considered that?
With earned income, Roth conversions, and bond income I’m over the MAGI limit.
by Tesla
Tue Mar 29, 2022 9:21 am
Forum: Personal Investments
Topic: Backdoor Roth Pro Rata Rule
Replies: 41
Views: 3177

Re: Backdoor Roth Pro Rata Rule

retiredjg wrote: Tue Mar 29, 2022 9:10 am If you are your wife are both retired (info from previous thread), you cannot contribute to an IRA anyway. You must have earned income to contribute to an IRA.

What you can do is Roth conversions. That could be something you want to consider.
Thanks. I retired in earlier this year. I’ll be doing Roth conversions for next few years, probably until RMDs kick in.
by Tesla
Tue Mar 29, 2022 9:03 am
Forum: Personal Investments
Topic: Backdoor Roth Pro Rata Rule
Replies: 41
Views: 3177

Re: Backdoor Roth Pro Rata Rule

Thanks for the input! Stopped me from making a stupid mistake.

Regarding iBonds I maxed out this year and maxed out gifts for next year. I’ll probably stop at that.