Search found 6774 matches

by kaneohe
Sat Jan 02, 2021 7:20 pm
Forum: Personal Finance (Not Investing)
Topic: Pay1040 credit card fee has increased to 1.99%
Replies: 10
Views: 1660

Re: Pay1040 credit card fee has increased to 1.99%

Ndop wrote: Fri Jan 01, 2021 2:41 pm PayUSAtax is still 1.96%
thanks for info on pay 1040 increased fees . KInda reluctant to change vendors due to similar names. One residual benefit (if timing of cc pymnt is correct) is that you get 2-3 wk float on payment.
by kaneohe
Fri Dec 25, 2020 5:50 pm
Forum: Personal Finance (Not Investing)
Topic: Help with simple capital gain tax
Replies: 11
Views: 1062

Re: Help with simple capital gain tax

https://www.mortgagecalculator.org/calc ... ulator.php

try using this calculator .......results much closer .to what you expect. I thought I was using the 2018 version but somehow ended with 2020. try toggling to get right yr
by kaneohe
Thu Dec 24, 2020 2:19 pm
Forum: Personal Finance (Not Investing)
Topic: $3000 refundable tax credit
Replies: 8
Views: 1534

Re: $3000 refundable tax credit

Thanks all for the inputs.............seems I made the whole thing up tho it sure seemed for real at the time that there would be a 3K refundable 2020 tax credit.
by kaneohe
Wed Dec 23, 2020 8:34 pm
Forum: Personal Finance (Not Investing)
Topic: $3000 refundable tax credit
Replies: 8
Views: 1534

$3000 refundable tax credit

all yr I've had a copy 0f a 2020 1040 on my mac showing what I thought was going to be a $3k refundable tax credit independent of any Child tax credits. educational credits , etc. Just a plain old independent credit. and not the 2400 credit.

I don't remember the name of the credit, whether it was real, or whether I just imagined it.

Any other ideas?
by kaneohe
Wed Dec 23, 2020 12:15 am
Forum: Personal Finance (Not Investing)
Topic: Tax implications of various income streams?
Replies: 22
Views: 2164

Re: Tax implications of various income streams?

alexcr wrote: Tue Dec 22, 2020 11:16 am Thanks everyone for clearing this up for me, and for the very helpful resources, articles, and visuals shared. 🙏🏼

Happy to say this all makes sense now.
thanks for providing feedback about how sunlight is overcoming the darkness :happy
by kaneohe
Sun Dec 20, 2020 11:28 pm
Forum: Personal Finance (Not Investing)
Topic: Tax implications of various income streams?
Replies: 22
Views: 2164

Re: Tax implications of various income streams?

https://www.bogleheads.org/forum/viewtopic.php?t=86849 see the stacked bar cHart by tfb 12/11/11. the QD /LTCG are stacked on top of the other ordinary income. The deductions come out of the bottom of the stack (ordinary income). note since the tax laws changed, numbers have changed but basic idea is the same Thanks. I found the chart below. I'm not clear, though, on the point of stacking (i) qualified dividends and long-term capital gains on top of (ii) ordinary income. If the two are subject to separate tax brackets and have no impact on the calculation of one another - unless I'm mistaken about that - shouldn't they be thought of as independent stacks? https://lh6.googleusercontent.com/-iRY5V8QmA70/TuUzkAlEOwI/AAAAAAAAADQ/IVUuHHIvDyQ/s6...
by kaneohe
Sun Dec 20, 2020 11:15 pm
Forum: Personal Finance (Not Investing)
Topic: Tax implications of various income streams?
Replies: 22
Views: 2164

Re: Tax implications of various income streams?

https://www.bogleheads.org/forum/viewtopic.php?t=86849 see the stacked bar cHart by tfb 12/11/11. the QD /LTCG are stacked on top of the other ordinary income. The deductions come out of the bottom of the stack (ordinary income). note since the tax laws changed, numbers have changed but basic idea is the same Thanks. I found the chart below. I'm not clear, though, on the point of stacking (i) qualified dividends and long-term capital gains on top of (ii) ordinary income. If the two are subject to separate tax brackets and have no impact on the calculation of one another - unless I'm mistaken about that - shouldn't they be thought of as independent stacks? https://lh6.googleusercontent.com/-iRY5V8QmA70/TuUzkAlEOwI/AAAAAAAAADQ/IVUuHHIvDyQ/s6...
by kaneohe
Sun Dec 20, 2020 5:55 pm
Forum: Personal Finance (Not Investing)
Topic: Tax implications of various income streams?
Replies: 22
Views: 2164

Re: Tax implications of various income streams?

https://www.irs.gov/pub/irs-pdf/f1099div.pdf

a 1099-div.............note that box 1a is total ordinary dividends; box 1b is qualified dividends
which is a subset of 1a. 1a can be 1k and 1b can be 1k which means all dividends are qualified.
You can also have 1a be 1k and 1b =0 which means no qual div and all 1k is non-qualified
by kaneohe
Sun Dec 20, 2020 5:44 pm
Forum: Personal Finance (Not Investing)
Topic: Tax implications of various income streams?
Replies: 22
Views: 2164

Re: Tax implications of various income streams?

viewtopic.php?t=86849

see the stacked bar cHart by tfb 12/11/11. the QD /LTCG are stacked on top of the other ordinary
income. The deductions come out of the bottom of the stack (ordinary income). note since the tax laws changed, numbers have changed but basic idea is the same
by kaneohe
Sun Dec 20, 2020 5:10 pm
Forum: Personal Finance (Not Investing)
Topic: Tax implications of various income streams?
Replies: 22
Views: 2164

Re: Tax implications of various income streams?

it might be useful to input your info into a calculator like this https://www.mortgagecalculator.org/calc ... ulator.php

to compare your terminology with std
by kaneohe
Sun Dec 20, 2020 4:55 pm
Forum: Personal Finance (Not Investing)
Topic: Tax implications of various income streams?
Replies: 22
Views: 2164

Re: Tax implications of various income streams?

Apologies for the basic tax questions here. Let's say you're retired and have the following income streams... • Short-term capital gains • Long-term capital gains • Non-qualified dividends • Qualified dividends • Taxable bond interest • Tax-exempt bond interest (AMT-exempt, as well) • Traditional IRA distributions (assuming IRA was funded entirely with deductible dollars) • Taxable portions of social security payments • Tax-exempt portions of social security payments • Taxable portions of annuity payments • Tax-exempt portions of annuity payments A few questions on federal taxes... 1) Am I correct that short-term capital gains, non-qualified dividends, taxable bond interest, IRA distributions, taxable portions of social security payments, ...
by kaneohe
Fri Dec 18, 2020 10:14 pm
Forum: Personal Finance (Not Investing)
Topic: Tax underpayment penalty, moving from Single to MFJ
Replies: 6
Views: 810

Re: Tax underpayment penalty, moving from Single to MFJ

The penalty calculation is the same as it is percentage of the underpayment and the percentage is not dependent on filing status. The answer to your last question, the safe-harbor amount based on the prior-year’s taxes, can be found in the instructions for Form 2210 and is the sum of both of your tax from the prior-year. could you show where in the 2210 instructions you found that? I was not able to find any words about filing status . thanks Instructions for line 8. In the 2019 instructions (PDF) on the IRS website, it’s at the bottom of page 4. “If you are filing a joint return for 2019, but you didn't file a joint return for 2018, add your 2018 tax (as figured earlier) to your spouse's 2018 tax (as figured earlier) and enter the total o...
by kaneohe
Fri Dec 18, 2020 6:00 pm
Forum: Personal Finance (Not Investing)
Topic: Tax underpayment penalty, moving from Single to MFJ
Replies: 6
Views: 810

Re: Tax underpayment penalty, moving from Single to MFJ

2021 will be the first year I file taxes jointly with my spouse. Since a significant amount of my income comes from investments, I withhold an extra amount of money from my earnings so that I am not penalized at the end of the year. Does anyone know how this penalty is calculated when switching from single to MFJ? Is the 100% of last year's tax computed using the sum of our taxes from 2020? The penalty calculation is the same as it is percentage of the underpayment and the percentage is not dependent on filing status. The answer to your last question, the safe-harbor amount based on the prior-year’s taxes, can be found in the instructions for Form 2210 and is the sum of both of your tax from the prior-year. could you show where in the 2210...
by kaneohe
Fri Dec 18, 2020 2:14 pm
Forum: Personal Finance (Not Investing)
Topic: Tax underpayment penalty, moving from Single to MFJ
Replies: 6
Views: 810

Re: Tax underpayment penalty, moving from Single to MFJ

not sure but I would guess that you combine your incomes (for 2020) not your taxes so you create a picture of what it would have been like in 2020 if you were filing MFJ.
by kaneohe
Wed Dec 16, 2020 7:14 pm
Forum: Personal Finance (Not Investing)
Topic: Quarterly taxes report in tax return
Replies: 11
Views: 884

Re: Quarterly taxes report in tax return

much easier to pay by withholding
by kaneohe
Tue Dec 15, 2020 2:00 pm
Forum: Investing - Theory, News & General
Topic: Hard time understanding performance benefit of non-deductible tIRA and taxable accounts...
Replies: 10
Views: 1099

Re: Hard time understanding performance benefit of non-deductible tIRA and taxable accounts...

assume 10K in a non-deductible contribution IRA vs taxable account
1)in IRA, value doubles in N yrs to 20K . When withdrawn from IRA the 10K gain is taxed at ordinary rates e.g. 22% so ending value is 17.8K

2)in taxable account, value also doubles in N yrs to 20K. When withdrawn you pay CG taxes perhaps at 15% so you end up w/18.5K
by kaneohe
Tue Dec 15, 2020 11:49 am
Forum: Investing - Theory, News & General
Topic: Do I understand capital loss and carryover correctly?
Replies: 12
Views: 1694

Re: Do I understand capital loss and carryover correctly?

https://www.mortgagecalculator.org/calc ... ulator.php

The QDCG wksht is hard to understand. you might be better off using the calculator.
by kaneohe
Sat Dec 12, 2020 5:25 pm
Forum: Personal Investments
Topic: Backdoor Roth - 1 cent in tIRA
Replies: 15
Views: 1969

Re: Backdoor Roth - 1 cent in tIRA

bogletay wrote: Sat Dec 12, 2020 4:05 pm Thanks all! I'll just plan to convert the full amount come January.
you will have fill out an f8606 for 2020 w/ a yr end balance of 1 cent. might be cleaner if you converted it this yr
by kaneohe
Mon Dec 07, 2020 6:06 pm
Forum: Personal Investments
Topic: How do estimated taxes work?
Replies: 20
Views: 2484

Re: How do estimated taxes work?

BogleDan wrote: Mon Dec 07, 2020 5:10 pm One thing to keep in mind is your effective tax rate vs. your marginal one. If you're in the 22% bracket (I think you're higher than that, by the way, based on the income you told us), your effective rate is probably lower than that (depending on deductions). You only need to pay THAT percentage tax on the savings bonds, not your full marginal rate.
why? isn't that the definition of full marginal rate? the rate that is applied to the next marginal dollar of income?
by kaneohe
Mon Dec 07, 2020 4:41 pm
Forum: Personal Investments
Topic: How do estimated taxes work?
Replies: 20
Views: 2484

Re: How do estimated taxes work?

jumpy wrote: Tue Dec 01, 2020 11:49 am

If I cash one this month (December 2020),
when does this mature? if you cash in early, you could lose 6 mos of interest
by kaneohe
Mon Dec 07, 2020 4:37 pm
Forum: Personal Investments
Topic: How do estimated taxes work?
Replies: 20
Views: 2484

Re: How do estimated taxes work?

jumpy wrote: Tue Dec 01, 2020 1:13 pm Yes, sorry, you are correct increment. The purchase price was $5,000, so the interest is $15,000 of the $20,000 redemption. Thanks for pointing that out!


you might want to double check this............at one time bonds were sold at 50% of face value so possibly the purchase price is 2.5K
https://finance.zacks.com/long-series-e ... -7923.html
by kaneohe
Mon Dec 07, 2020 4:25 pm
Forum: Personal Investments
Topic: How do estimated taxes work?
Replies: 20
Views: 2484

Re: How do estimated taxes work?

https://www.treasurydirect.gov/BC/SBCPrice

if you have paper bonds , you can use this tool to estimate value at maturity of amount to be taxed
(from the denomination).....be sure you don't cash in before maturity .......you might lose some interest.

you should study the safe harbor rules and be comfortable w/ them and know that increasing w/h
is the easiest way to deal w/ this since w/h date doesn't matter........but estimated tax date matters a lot.
by kaneohe
Sun Dec 06, 2020 10:48 pm
Forum: Personal Finance (Not Investing)
Topic: I Bonds / Paying Estimated Taxes only in 4th quarter
Replies: 17
Views: 1909

Re: I Bonds / Paying Estimated Taxes only in 4th quarter

JoMoney wrote: Sun Dec 06, 2020 5:16 pm ..................................................


Maybe I was just testing you guys :twisted:

Thanks :beer
Hey, you forgot to add in the extra float time when you pay by cc......could be nearly a month at 0.6% and if your cc cycle is optimized you might get another few wks :beer
by kaneohe
Sun Dec 06, 2020 5:41 pm
Forum: Personal Finance (Not Investing)
Topic: I Bonds / Paying Estimated Taxes only in 4th quarter
Replies: 17
Views: 1909

Re: I Bonds / Paying Estimated Taxes only in 4th quarter

tj wrote: Sun Dec 06, 2020 5:29 pm
whodidntante wrote: Sun Dec 06, 2020 3:59 pm Go ahead and do the estimated payment now if you like, but you can also do a 2020 tax payment via CC just before you file in 2021.

It's not necessary to do estimated payments all year in your scenario. Timing of tax payments is only a factor if you underpay in our pay as you go system. There are quarterly deadlines for tax payments.
There's a Form 2210 that the various softwares will help you fill out. I've had to pay the penalty before and it was like $10. Not enough to be worried about, I don't think.
sounds like w/h would cover the taxes and extra payment is just to be able to buy the I bonds so I wouldn't think there would a need for 2210.
by kaneohe
Sun Dec 06, 2020 4:36 pm
Forum: Personal Finance (Not Investing)
Topic: I Bonds / Paying Estimated Taxes only in 4th quarter
Replies: 17
Views: 1909

Re: I Bonds / Paying Estimated Taxes only in 4th quarter

JoMoney wrote: Sun Dec 06, 2020 3:54 pm ...........................

I'm considering just going to https://www.pay1040.com/ , submitting their 1040-ES form , and paying the $5,000 with my 2% cash back credit card.
They service fee for the payment is 1.87%, so I might net $3.50 right off the top.

....................
try doing that calculation again ..............1% =50; 0.1% =5. 0.13%=
by kaneohe
Sun Dec 06, 2020 3:41 pm
Forum: Personal Investments
Topic: Social security income and tax brackets
Replies: 14
Views: 2662

Re: Social security income and tax brackets

The amount of SS taxed depends on the amount of SS and other income. Roughly it sounds like there is 19.2K of SS and 8.8K of other income. Take 1/2 of SS =9.6 and add to 8.8K other income = 18.4K. No SS is taxed until that 18.4K gets to 25K for a single.
by kaneohe
Sun Dec 06, 2020 3:16 pm
Forum: Personal Investments
Topic: Back Door Roth Help
Replies: 3
Views: 350

Re: Back Door Roth Help

your IRA and wife's IRA are completely separate for this calculation. Perhaps take a look at filling out
F8606 to see how this works.
by kaneohe
Sun Dec 06, 2020 12:44 pm
Forum: Personal Finance (Not Investing)
Topic: Need help understanding which cost basis numbers to look at/taxes
Replies: 8
Views: 663

Re: Need help understanding which cost basis numbers to look at/taxes

If you have AVB on some funds, it is possible that some of those funds will have to remain at AVB and only after you select to switch spec ID , future purchases will then be spec ID basis.
by kaneohe
Sat Dec 05, 2020 4:08 pm
Forum: Personal Finance (Not Investing)
Topic: backdoor Roth IRA pro rata rule
Replies: 38
Views: 2485

Re: backdoor Roth IRA pro rata rule

1. In January (as with every year) I contribute the max($6K) to non deductible IRA and convert it into ROTH immediately. This is the usual backdoor roth process. This is with Fidelity. At this point my tIRA balance is 0. 2. I switched jobs in January and moved my pretax and post tax monies from my previous employer in summer 2020. I moved the pre-tax dollars (~$165K) to the tIRA (Fidelity) and post tax dollars (~$30K) into the ROTH IRA(Fidelity, same account as in 1). 3. After a few weeks of completing step 2 I moved all the tIRA money to my vanguard tIRA. I did this because I do step 1 every year, I wanted to have the fidelity tIRA account clear for this process. There has been plenty of coverage of the pro-rata rule by others, but in rea...
by kaneohe
Sat Dec 05, 2020 3:54 pm
Forum: Personal Finance (Not Investing)
Topic: Need help understanding which cost basis numbers to look at/taxes
Replies: 8
Views: 663

Re: Need help understanding which cost basis numbers to look at/taxes

Infomom2 wrote: Sat Dec 05, 2020 12:09 pm Thanks! So, as a first step, if I am looking at the Vanguard site, I am looking at unrealized long term and short term gains and both of these figures count?

The tax calculator posted is great! Thank you; I had been looking for one for 2020. It looks like QBI is not calculated in, but it allows me to put it in myself (I do know I qualify). So, that would be 20% of the number they list as my taxable income, is that right?
gains only matter when they are realized.............so imagine which ones you want to take and then do your calculator simulations.
QBI deduction is 20% of your QBI (not your taxable income)
by kaneohe
Sat Dec 05, 2020 12:21 pm
Forum: Personal Finance (Not Investing)
Topic: backdoor Roth IRA pro rata rule
Replies: 38
Views: 2485

Re: backdoor Roth IRA pro rata rule

pingpong wrote: Fri Dec 04, 2020 8:38 pm
FiveK wrote: Fri Dec 04, 2020 6:22 pm
pingpong wrote: Fri Dec 04, 2020 5:10 pm This does not only make me pay double tax on this year's 6K but also prevents me from making this backdoor roth ira again next year.
Your current tax rate may be high, but you won't be paying "double" tax. The $6K contribution that you made after tax this year will never be taxed again, provided you use Form 8606 correctly.
Agree. The $6K will not be taxed. However I will loose the tax free growth that ROTH offers.
only if you don't do conversion
by kaneohe
Sat Dec 05, 2020 11:50 am
Forum: Personal Finance (Not Investing)
Topic: Need help understanding which cost basis numbers to look at/taxes
Replies: 8
Views: 663

Re: Need help understanding which cost basis numbers to look at/taxes

decide which transactions you will sell............then you will know the tax consequences depending on whether they are ST or LT.

this calculator may help https://www.mortgagecalculator.org/calc ... ulator.php
by kaneohe
Fri Dec 04, 2020 6:57 pm
Forum: Investing - Theory, News & General
Topic: Can anyone reach Vanguard on the phone?
Replies: 244
Views: 32357

Re: Can anyone reach Vanguard on the phone?

called VG this AM ........was offered call back in 9-13min and took it. Call back was exactly as advertised to I was pleased by response.
by kaneohe
Wed Dec 02, 2020 10:25 pm
Forum: Personal Investments
Topic: taxation of savings bond interest
Replies: 34
Views: 2559

Re: taxation of savings bond interest

15202guy wrote: Wed Dec 02, 2020 7:41 pm
Carl53 wrote: Wed Dec 02, 2020 3:33 am Your case likely is not where your parents havbe space in the zero bracket, but they might be persuaded to consider the tax ramifications for their heirs.
Yup -- no 0% space, but they're happy to use space in a much lower bracket than the alternative (me).
seems clear that parents can pay all the tax in their lower bracket............but the all the funds belong to them. Any attempt for child to retrieve part of the funds (w/o paying fair share of taxes) seems likely to violate the step transaction doctrine........where a complex series of steps is looked at as a whole even if the individual steps are drawn out............https://en.wikipedia.org/wiki/Step_transaction_doctrine
by kaneohe
Wed Dec 02, 2020 12:59 pm
Forum: Personal Finance (Not Investing)
Topic: Need Help Clearing Out Traditional IRA with Non-Deductible Contributions
Replies: 3
Views: 418

Re: Need Help Clearing Out Traditional IRA with Non-Deductible Contributions

atxll wrote: Wed Dec 02, 2020 10:46 am That is good news, thanks a lot for answering so quickly. Would it be best to just sell off $5500 out of one of my funds and hold it in money market for the conversion to Roth? Then re-buy once it is in the Roth account?
yes........otherwise the value could decrease and you would be guilty of sending part of basis to the 401K.
by kaneohe
Tue Dec 01, 2020 7:46 pm
Forum: Personal Investments
Topic: taxation of savings bond interest
Replies: 34
Views: 2559

Re: taxation of savings bond interest

sounds like there can be ambiguity as to who owns what. I would guess tho that there is no ambiguity between the 2 parties as to who owns what (but known only to the parties.
by kaneohe
Tue Dec 01, 2020 7:40 pm
Forum: Personal Investments
Topic: Roth Conversion/Withdrawal Question
Replies: 11
Views: 1314

Re: Roth Conversion/Withdrawal Question

1) When you do a conversion,it can be of deductible contributions into TIRA. You did a tax deduction for that contribution so the conversion is fully taxable. That is a taxable conversion.

You can also file F8606 to declare a non-deductible (or after tax contribution). And use F8606 to show the conversion was non-taxable

You can also have a conversion that incorporates the features of both........part taxable and part non-taxable.

2) you are correct on 2. At age 59.5, the 5 yr conversion clock switches to the 5 yr age of oldest Rpth so the conversion clock becomes irrelevant
by kaneohe
Tue Dec 01, 2020 3:48 pm
Forum: Personal Investments
Topic: Roth Conversion/Withdrawal Question
Replies: 11
Views: 1314

Re: Roth Conversion/Withdrawal Question

see table below by kawill: you need to know the ordering rules........contributions come out first, then conversions oldest first (and within each conversion. the taxable part comes first; then finally earnings. The table is written to reflect these rules. Here is the table version of the Roth Conversion chart that many here reference: Re: Roth IRA Rules - Table Approach Posted by: KAWill (IP Logged) Date: October 14, 2010 11:57PM Roth IRA Distribution Table UNDER AGE 59.5 FIVE YEAR CONVERSION HOLDING PERIOD NOT MET Contributions: Tax-No; Penalty-No Conversions: Tax-No; Penalty-Yes (Taxable Portion) Conversions: Tax-No ;Penalty-No (Nontaxable Portion) Earnings: Tax-Yes; Penalty-Yes UNDER AGE 59.5 FIVE YEAR CONVERSION HOLDING PERIOD MET Cont...
by kaneohe
Tue Dec 01, 2020 3:03 pm
Forum: Personal Investments
Topic: How do estimated taxes work?
Replies: 20
Views: 2484

Re: How do estimated taxes work?

you need to do some calculations......since your AGI >150K, the safe harbor based on last yr is 110% of last yr taxes. The safe harbor based on this yr is 90% of this yr taxes. If you didn't change anything this yr, last yr safe harbor won't help you. This yr safe harbor may or may not depending on how much you paid.

https://www.mortgagecalculator.org/calc ... ulator.php
this might help

if you need to pay more, withholding is a much cleaner way of doing things.
by kaneohe
Tue Dec 01, 2020 10:23 am
Forum: Personal Finance (Not Investing)
Topic: medicare without supplement
Replies: 47
Views: 5323

Re: medicare without supplement

In one day your health can change from great to problematic. if you get some LARGE medical bills, 20% of a large number can still be a large number.
by kaneohe
Mon Nov 30, 2020 5:40 pm
Forum: Personal Finance (Not Investing)
Topic: When can I no longer file as Head of Household
Replies: 19
Views: 2145

Re: When can I no longer file as Head of Household

https://www.irs.gov/pub/irs-pdf/p4012.pdf see p.C1

note that the dependent chart is in 2 parts:
1)left side = qualifying child
2) right side = qualifying relative

It is almost always more beneficial to be a qualifying child. Note that there no earnings restrictions
for qualifying child.

The earning restriction is for qualifying relative when the child ages out of qualifying child due to age, school changes, etc.
by kaneohe
Mon Nov 30, 2020 4:25 pm
Forum: Personal Investments
Topic: taxation of savings bond interest
Replies: 34
Views: 2559

Re: taxation of savings bond interest

https://www.irs.gov/publications/p550#en_US_2019_publink100010061 hopefully this gets you to the nominee section of IRS pub 550 Nominee distributions. If you received a Form 1099-INT that includes an amount you received as a nominee for the real owner, report the full amount shown as interest on the Form 1099-INT on Part I, line 1 of Schedule B (Form 1040 or 1040-SR). Then, below a subtotal of all interest income listed, enter "Nominee Distribution" and the amount that actually belongs to someone else. Subtract that amount from the interest income subtotal. Enter the result on line 2b of Form 1040 or 1040-SR. File Form 1099-INT with the IRS. If you received interest as a nominee in 2019, you must file a Form 1099-INT for that int...
by kaneohe
Mon Nov 30, 2020 12:38 pm
Forum: Personal Finance (Not Investing)
Topic: Complicated backdoor Roth situation
Replies: 9
Views: 792

Re: Complicated backdoor Roth situation

atthebuzzer wrote: Mon Nov 30, 2020 12:12 pm Thank you so much Katie and Alan! I really appreciate your help

Here's my plan:
1. I'll ask Fidelity to roll my TIRA into my workplace 401k (I'm assuming they will automatically only roll the pre-tax amounts and not after tax contributions)
2. Once I verify that these funds are deposited, I will convert the remainder of the funds to my Roth IRA
3. I'll keep everything in cash until this is complete.
better to not assume anything...........How does Fidelity know whether you took a tax deduction or not?
by kaneohe
Mon Nov 30, 2020 12:16 pm
Forum: Personal Investments
Topic: taxation of savings bond interest
Replies: 34
Views: 2559

Re: taxation of savings bond interest

IRS doesn't care who pays........as long as somebody does. If you cash them in, the bank will probably get your SSN and you will get the 1099-INT and be responsible for paying. Are you sharing the proceeds w/ parent.....would they be willing to pay their share of the taxes? You could put the full amount on your tax return to reflect the 1099 and then subtract out the amount that you give the parent (as a nominee). You will have to create the nominee document to reflect what they got so they can pay the tax on their share.
by kaneohe
Sun Nov 29, 2020 7:10 pm
Forum: Personal Finance (Not Investing)
Topic: Backdoor Roth Withdrawal
Replies: 4
Views: 393

Re: Backdoor Roth Withdrawal

did you have any other prior contributions to Roth?
by kaneohe
Sat Nov 28, 2020 10:56 pm
Forum: Personal Investments
Topic: Can you please explain this to me
Replies: 5
Views: 1174

Re: Can you please explain this to me

It is likely that the short term yld equivalent will be near the distribution yld 2.18% (annualized) for the short term but for the longer term it is likely to decrease. You can already see that in the medium term history........so be ready to bail (or adjust your expectations).
by kaneohe
Sat Nov 28, 2020 4:56 pm
Forum: Personal Finance (Not Investing)
Topic: How to proceed for lowering state tax penalty due to income annualization
Replies: 18
Views: 1850

Re: How to proceed for lowering state tax penalty due to income annualization

You have the numbers so you know better but seems like Istone19's suggestion for using regular method but using w/h when done would be best of both worlds................your front loaded income gets spread out more evenly during the yr but you get credit for the w/h when actually paid.........
so is the problem that you didn't pay enough to make the 90% safe harbor and the penalty being assessed on that late payment?
by kaneohe
Sat Nov 28, 2020 1:53 pm
Forum: Personal Finance (Not Investing)
Topic: How to proceed for lowering state tax penalty due to income annualization
Replies: 18
Views: 1850

Re: How to proceed for lowering state tax penalty due to income annualization

doesn't feel like the short method applies to you.........
Short Method
You may use the short method only if you are a calendar year taxpayer and either one of the following apply:

You made no estimated tax payments or your only payments were California income tax withheld.
You paid estimated tax on the required due dates.

if you use the regular method the dates apply to the tax payments, not to the income so you should not be annualizing income for the regular method. For IRS regular method, it is assumed that 25% of income is in each period. Not sure about CA, but guessing that 30%, 40%, 0%, 30% which agrees w/payment expected..
by kaneohe
Sat Nov 28, 2020 8:48 am
Forum: Personal Finance (Not Investing)
Topic: How to proceed for lowering state tax penalty due to income annualization
Replies: 18
Views: 1850

Re: How to proceed for lowering state tax penalty due to income annualization

If California is like Federal (and my state of Illinois), unequal withholding is handled independently of annualizing income. If so, then with your case of lots of both income and withholding in the 1st quarter, you can report the withholding in the actual quarter it was withheld (rather than equally divided across the four quarters) while have the income treated as occurring equally across the quarters. Take a look at California’s equivalent of Federal Form 2210. Thanks isoton19 Not much flexibility, CA/FTB form 5805 uses precise steps with the logic that I can make out from the steps for AI: 1-Uses actual withholdings from pay stubs etc. 2-Uses actual AGI for respective periods from pay stubs etc. No flexibility. 3-The assume 30%, 40%, 0...
by kaneohe
Fri Nov 27, 2020 7:42 pm
Forum: Personal Finance (Not Investing)
Topic: How to proceed for lowering state tax penalty due to income annualization
Replies: 18
Views: 1850

Re: How to proceed for lowering state tax penalty due to income annualization

https://www.ftb.ca.gov/forms/2019/2019-5805.pdf 6 Required annual payment. Enter the smaller of line 2 or line 5. (If your California AGI is equal to or greater than $1,000,000/$500,000 for married/RDP filing a separate return, use line 2) . possibly you are suffering from CA's modified rules if your CA AGI>1M (MFJ). You don't get use the prior yr safe harbor and must use the 90% of current yr safe harbor. If your income was primarily in Q1, not sure how annualizing income would be a benefit over just assuming an even annual flow. Thanks Kaneohe. -Yes it applies to me and hence I need to pay penalty using 90% of 2019 tax otherwise I would have already met the 110% of 2018 tax due to relatively low income of 2018. -Since my ~90% income is i...