Search found 10937 matches

by DSInvestor
Mon Feb 18, 2019 12:55 pm
Forum: Investing - Theory, News & General
Topic: Question re Taxes on Dividends
Replies: 22
Views: 1022

Re: Question re Taxes on Dividends

If your ONLY income is $350k in qualified dividends, you either pay 0%, 15% or 20% (plus Obama’s 3.8%), right? You cant owe more than 23.8%, right? The way I read the actual tax code, the tax rate on a person who has no income other than qualified dividend income should be zero. That level of incom...
by DSInvestor
Wed Feb 13, 2019 12:19 am
Forum: Personal Finance (Not Investing)
Topic: Couple quick Backdoor Roth Questions....
Replies: 3
Views: 336

Re: Couple quick Backdoor Roth Questions....

Your accountant is likely to use tax software to prepare your tax return. Tax software will automatically add form 8606 if you have IRA basis (non-Traditional IRA contribution) and/or you did a Roth conversion. Make sure you tell the accountant that you made a 2018 Traditional IRA contribution. If t...
by DSInvestor
Thu Feb 07, 2019 2:12 pm
Forum: Personal Investments
Topic: IRA in addition to 401k max
Replies: 4
Views: 405

Re: IRA in addition to 401k max

Yes, IRA contribution is allowed above and beyond your 401k max. If you're looking to max out tax advantaged space and are married filing a joint tax return, be aware that your spouse can also contribute to IRA even with no compensation. At your level of income with coverage by 401k, your Traditiona...
by DSInvestor
Tue Feb 05, 2019 2:28 am
Forum: Personal Finance (Not Investing)
Topic: Choose Deductible Roth Conversion or Non Deductible?
Replies: 6
Views: 461

Re: Choose Deductible Roth Conversion or Non Deductible?

Are you covered by an employer plan? If covered and you find that you're eligible for TIRA deduction, perhaps you're eligible for direct Roth IRA contribution. If eligible for Roth contribution, you have a third choice to simply recharacterize your TIRA contribution to a Roth IRA contribution. With ...
by DSInvestor
Tue Feb 05, 2019 1:31 am
Forum: Personal Investments
Topic: Roth IRA, TIRA questions
Replies: 14
Views: 1245

Re: Roth IRA, TIRA questions

Are solo 401k contributions deductible in the same way as TIRA contributions? Solo 401k contributions allow for several types of contributions: 1) Employer profit share. These are pretax and will reduce your AGI and taxable income like Traditional IRA deduction. All solo 401k plans offer this type ...
by DSInvestor
Sun Feb 03, 2019 8:08 pm
Forum: Personal Investments
Topic: Roth IRA, TIRA questions
Replies: 14
Views: 1245

Re: Roth IRA, TIRA questions

I am self employed with a sole proprietorship and have a Roth IRA in my name. Lately my business has done really well and as a result I have already maxed out my 2019 contributions. I want to open another IRA in my wife's name and I'm not sure if it should be traditional or Roth. She doesn't curren...
by DSInvestor
Sun Feb 03, 2019 12:29 pm
Forum: Personal Finance (Not Investing)
Topic: Backdoor Conversion Being Taxed
Replies: 18
Views: 1397

Re: Backdoor Conversion Being Taxed

You did two things 1) Traditional IRA contribution for 2018 and 2) Roth conversion. You must enter each step into your tax return. If you only entered the 1099-R, that only handles the Roth conversion and you missed the TIRA contribution. Depending on your tax situation, your Traditional IRA contrib...
by DSInvestor
Tue Jan 29, 2019 6:56 pm
Forum: Personal Investments
Topic: messed up roth IRA
Replies: 1
Views: 191

Re: messed up roth IRA

Consider a recharacterization of that 2018 Roth IRA contribution to a 2018 Traditional IRA contribution. For more details on recharacterizations, see Fairmark's recharactsrizations page: https://fairmark.com/retirement/roth-accounts/recharacterizations/ Fairmark also has a page on Excess contributio...
by DSInvestor
Mon Jan 28, 2019 1:30 pm
Forum: Personal Investments
Topic: Lousy Bond Choices in 401k -- edited to full template
Replies: 10
Views: 366

Re: Lousy Bond Choices in 401k

63% of your portfolio is in Vanguard Target Retirement 2035. This fund is 23% bonds. Out of that 63%, 23% is bonds. 0.63 X 0.23 = 0.1449 or 14.5%. If all other holdings in the portfolio are stocks, this implies that your total portfolio has around 14.5% bonds. If this is not enough, you can consider...
by DSInvestor
Mon Jan 28, 2019 1:08 pm
Forum: Personal Investments
Topic: Lousy Bond Choices in 401k -- edited to full template
Replies: 10
Views: 366

Re: Lousy Bond Choices in 401k

I suggest treating all accounts together as one big portfolio. As long as the total amount of stocks across all accounts is fine, you're fine. If the 401k has no low cost bond option, use the Rollover IRA to invest in a low cost bond fund like Vanguard Total Bond Market Index. IMO using a bond fund ...
by DSInvestor
Mon Jan 28, 2019 12:39 pm
Forum: Personal Investments
Topic: Roth IRA or TIRA or pay down mortgage?
Replies: 8
Views: 426

Re: Roth IRA or TIRA or pay down mortgage?

I started making extra principal payments after I had maxed out my 401k and IRAs. I suggest prioritizing IRA contributions ahead of attacking the mortgage. ....... Once your income reaches a level where you are not allowed to contribute directly to Roth IRA, consider Traditional IRA contributions (...
by DSInvestor
Mon Jan 28, 2019 12:31 pm
Forum: Personal Investments
Topic: TIRA to ROTH advice - messed up 2018 contributions
Replies: 13
Views: 292

Re: TIRA to ROTH advice - messed up 2018 contributions

Sorry if I am being unclear. I made a TIRA contribution in march of 2018 and had them apply it to the 2017 year. The following day I converted that contribution into a ROTH IRA. I was under the impression that conversion would count for the 2017 tax year (which I think is what i specified). When I ...
by DSInvestor
Mon Jan 28, 2019 12:14 pm
Forum: Personal Investments
Topic: Can you have max out a 401k and have a SEP-IRA?
Replies: 16
Views: 1012

Re: Can you have max out a 401k and have a SEP-IRA?

In your situation where you've maxed out employee contributions at W-2 job, you can either use Solo 401k employer profit share contributions or SEP-IRA contributions to defer some of your self employed income. SEP-IRA has the disadvantage of working against you if you use the backdoor into Roth IRA ...
by DSInvestor
Mon Jan 28, 2019 11:56 am
Forum: Personal Investments
Topic: Roth IRA or TIRA or pay down mortgage?
Replies: 8
Views: 426

Re: Roth IRA or TIRA or pay down mortgage?

I started making extra principal payments after I had maxed out my 401k and IRAs. I suggest prioritizing IRA contributions ahead of attacking the mortgage. Your income and coverage by employer plan (403b and 457b) makes Traditional IRA contributions a poor choice because neither of you are eligible ...
by DSInvestor
Mon Jan 28, 2019 11:26 am
Forum: Personal Finance (Not Investing)
Topic: Double Recharacterization: TIRA -> Roth -> TIRA
Replies: 2
Views: 119

Re: Double Recharacterization: TIRA -> Roth -> TIRA

I do not think it is possible to recharacterize the contribution again. According to Fairmark.com (tax attorney), the recharacterization is an irrevocable election. See Fairmark.com's recharacterization rules: https://fairmark.com/retirement/roth-accounts/recharacterizations/recharacterization-rules...
by DSInvestor
Sun Jan 27, 2019 3:07 pm
Forum: Personal Finance (Not Investing)
Topic: Can sum of IRA contributions exceed Earned Income?
Replies: 14
Views: 891

Re: Can sum of IRA contributions exceed Earned Income?

marcopolo wrote:
Sun Jan 27, 2019 2:59 pm
Too bad a Roth SEP IRA is not allowed.
If you will continue to have self employed income in 2019 and beyond, maybe consider switching to a Solo 401k that offers the Roth option.
by DSInvestor
Sun Jan 27, 2019 2:49 pm
Forum: Personal Finance (Not Investing)
Topic: Can sum of IRA contributions exceed Earned Income?
Replies: 14
Views: 891

Re: Can sum of IRA contributions exceed Earned Income?

If one has a Solo 401k with the option for Roth contributions, I believe it would be possible to contribute 7K to Roth employee salary deferral to Solo 401k which leaves 7K to flow through to the tax return as compensation allowing another 7K to be contributed to TIRA combined to both spouses if mar...
by DSInvestor
Sun Jan 27, 2019 12:57 pm
Forum: Personal Investments
Topic: TLH newb 31 days later
Replies: 11
Views: 627

Re: TLH newb 31 days later

Keep it simple. Just go with VFWAX (Vanguard all World ex-US) without the small cap version. It is close enough to VTIAX (Total International).
by DSInvestor
Fri Jan 25, 2019 11:17 am
Forum: Personal Investments
Topic: Backdoor Roth contribution at age 70+?
Replies: 9
Views: 338

Re: Backdoor Roth contribution at age 70+?

Traditional IRA contributions are NOT permitted for those over age 70.5. If you will be 70.5 by the end of 2020 you are not eligible for any Traditional IRA contributions for this 2020 tax year. For more details see IRS Pub 590A. Roth IRA contributions are not limited by age so if there is a way to ...
by DSInvestor
Thu Jan 24, 2019 11:58 am
Forum: Personal Investments
Topic: TLH newb 31 days later
Replies: 11
Views: 627

Re: TLH newb 31 days later

When selecting TLH replacement holdings, I suggest picking funds that you'd be comfortable holding forever in case the replacement fund has gains after you TLH. The FTSE All World ex-US VFWAX fund is an excellent choice to replace Total International. If you chart both funds together in morningstar,...
by DSInvestor
Wed Jan 23, 2019 11:44 pm
Forum: Personal Consumer Issues
Topic: Internet service speed issue
Replies: 25
Views: 1239

Re: Internet service speed issue

Is there any other activity on your home network when things are slow? When I used to have a lower level of service that had a slow upload speed (similar to yours), things would get really slow when there was a big upload such as a big email or file transfer, a cloud backup when iPhones were plugged...
by DSInvestor
Tue Jan 22, 2019 10:43 am
Forum: Personal Investments
Topic: Tax Gain Harvest vs Roth Conversions?
Replies: 8
Views: 441

Re: Tax Gain Harvest vs Roth Conversions?

I retired with assets in IRA and taxable. While living off the taxable account (Qualified Dividend Income and Long Term Capital Gains), I found that I could take advantage of the 0% tax rate on ordinary income provided by the standard deduction and exemptions. Roth conversions are ordinary income fo...
by DSInvestor
Tue Jan 22, 2019 10:10 am
Forum: Personal Investments
Topic: What domestic fund from 457 in 3 fund?
Replies: 2
Views: 96

Re: What domestic fund from 457 in 3 fund?

An 80/20 mix of Institutional index and Small Cap Index will approximate total stock market.
by DSInvestor
Mon Jan 21, 2019 2:46 pm
Forum: Personal Finance (Not Investing)
Topic: Roth Conversion and Capital Gains
Replies: 8
Views: 899

Re: Roth Conversion and Capital Gains

Perhaps you can tweak your taxable holdings to reduce/eliminate the amount of non-qualified dividend income and interest in the taxable account. Hold your taxable bonds in the traditional IRA space instead of taxable. If you can shift this 20-30K of interest/non-QDI income to be received in your IRA...
by DSInvestor
Mon Jan 21, 2019 1:21 pm
Forum: Personal Consumer Issues
Topic: Is it ever worth purchasing an extended warranty for a vehicle?
Replies: 90
Views: 4876

Re: Is it ever worth purchasing an extended warranty for a vehicle?

You have told us that you drive 25K miles/year. How many miles on your car now? You may get different suggestions if it has 95K miles or 30K miles.
by DSInvestor
Sun Jan 20, 2019 9:14 pm
Forum: Personal Investments
Topic: Roth Contribution Trouble?
Replies: 3
Views: 425

Re: Roth Contribution Trouble?

Your high income made you ineligible for Roth IRA contributions. Here is a link to a fairmark.com page on Excess Contributions to Roth IRA: https://fairmark.com/retirement/roth-accounts/contributions-to-roth-accounts/excess-contributions-to-roth-iras/ Take a look at recharacterizing your 2018 Roth I...
by DSInvestor
Sun Jan 20, 2019 8:15 pm
Forum: Personal Consumer Issues
Topic: Where to buy CR2032 batteries?
Replies: 48
Views: 3736

Re: Where to buy CR2032 batteries?

I bought some from Ikea a while back and they work great. Here's a link to item at ikea.com that sells for $2.99 per 8 pack:
https://www.ikea.com/us/en/catalog/prod ... 11556208_1
by DSInvestor
Sun Jan 20, 2019 11:43 am
Forum: Investing - Theory, News & General
Topic: Roth IRA Basis Ordering Rules
Replies: 6
Views: 379

Re: Roth IRA Basis Ordering Rules

What about Recharacterized Contributions? I believe these are considered Regular Contributions correct? Example: A $5,000 contribution during tax year to a Traditional IRA. January of subsequent year the $5,000 plus related $600 of growth are converted by Vanguard to Roth IRA. This is reported on F...
by DSInvestor
Sat Jan 19, 2019 1:21 pm
Forum: Investing - Theory, News & General
Topic: Roth IRA Basis Ordering Rules
Replies: 6
Views: 379

Re: Roth IRA Basis Ordering Rules

What about Recharacterized Contributions? I believe these are considered Regular Contributions correct? Example: A $5,000 contribution during tax year to a Traditional IRA. January of subsequent year the $5,000 plus related $600 of growth are converted by Vanguard to Roth IRA. This is reported on F...
by DSInvestor
Sun Jan 13, 2019 6:23 pm
Forum: Personal Finance (Not Investing)
Topic: Part time work and taxes
Replies: 5
Views: 579

Re: Part time work and taxes

When your 2 W-2 forms are entered into your tax return, you will be refunded the employee portion of social security that is above the max.
by DSInvestor
Sun Jan 13, 2019 2:57 pm
Forum: Personal Investments
Topic: Vanguard PRIMECAP and Capital Opportunity
Replies: 48
Views: 2903

Re: Vanguard PRIMECAP and Capital Opportunity

Both very tax inefficient. Do not hold in taxable accounts.
by DSInvestor
Sun Jan 13, 2019 1:36 pm
Forum: Personal Investments
Topic: Roast my portfolio. VEMAX instead of VTIAX?
Replies: 20
Views: 1600

Re: Roast my portfolio. VEMAX instead of VTIAX?

What assets do you have in tax advantaged accounts? If you're retired early and living off a taxable account, you can take advantage of low cost or even tax free Roth conversions to fill up 0% brackets provided by standard deduction and also by the favorable tax treatment of Qualified Dividend Incom...
by DSInvestor
Sat Jan 12, 2019 1:19 am
Forum: Personal Finance (Not Investing)
Topic: Roth conversion
Replies: 36
Views: 3005

Re: Roth conversion

An increase in income could cause disqualification for a ACA health insurance premium tax credit or trigger medicare IRMAA (Income related monthly adjustment amount). The ACA premium tax credit could be substantial (>10-20K depending on age). When I ran numbers on the KFF calculator, a couple age 6...
by DSInvestor
Fri Jan 11, 2019 1:13 pm
Forum: Personal Finance (Not Investing)
Topic: Roth conversion
Replies: 36
Views: 3005

Re: Roth conversion

An increase in income could cause disqualification for a ACA health insurance premium tax credit or trigger medicare IRMAA (Income related monthly adjustment amount). The ACA premium tax credit could be substantial (>10-20K depending on age). When I ran numbers on the KFF calculator, a couple age 64...
by DSInvestor
Thu Jan 03, 2019 1:06 am
Forum: Personal Investments
Topic: Confirm I’m Doing Backdoor Roth IRA Correctly
Replies: 7
Views: 940

Re: Confirm I’m Doing Backdoor Roth IRA Correctly

Yes. When you tell your 2018 tax return about the 2018 Traditional IRA contribution, the tax software will determine whether that contribution was deductible or non-deductible. If you're high income and covered by employer plan (TSP), your contribution will be non-deductible (IRA basis). As such, th...
by DSInvestor
Sun Dec 30, 2018 8:12 pm
Forum: Personal Investments
Topic: Too Heavy in Real Estate?
Replies: 12
Views: 990

Re: Too Heavy in Real Estate?

VBIAX is Vanguard Balanced Index Admiral and is not tax efficient as the bond portion of the fund throws off significant non-qualified dividend income. You're high income and live in a state with high state income tax. Consider more tax efficient options for the taxable account. Vanguard Total Stock...
by DSInvestor
Fri Dec 28, 2018 1:38 pm
Forum: Personal Finance (Not Investing)
Topic: Roth Conversion Paying Taxes with IRA?
Replies: 16
Views: 898

Re: Roth Conversion Paying Taxes with IRA?

What is your age? If under 59.5, be aware that withdrawals from Traditional IRA are subject to 10% early withdrawal penalty. If you withhold taxes on the Roth conversion, then the taxes withheld are technically a withdrawal from the Trad IRA and that amount is subject to 10% early withdrawal penalty...
by DSInvestor
Wed Dec 26, 2018 11:26 am
Forum: Personal Investments
Topic: what mix of VXUS & VTI = VT?
Replies: 12
Views: 714

Re: what mix of VXUS & VTI = VT?

Here's a link to VT's portfolio and management page that shows allocation by country:
https://investor.vanguard.com/etf/profile/portfolio/vt

USA is about 55% of the fund so maybe go with 55% VTI (Total Stock Market) and 45% VXUS (Total International Stock).
by DSInvestor
Wed Dec 26, 2018 11:14 am
Forum: Personal Finance (Not Investing)
Topic: backdoor roth and FUTURE possible IRAs..
Replies: 14
Views: 774

Re: backdoor roth and FUTURE possible IRAs..

A rollover to IRA will trigger IRA basis proration. Depending on your employer plan and balance you may have the option to keep assets where they are. Alternatively, your new employer plan may accept assets from the old plan. If you have self employed income and are eligible for Solo 401k, you could...
by DSInvestor
Sat Dec 22, 2018 11:35 pm
Forum: Personal Consumer Issues
Topic: Costco Tire Quality Seconds/Blems??
Replies: 31
Views: 2876

Re: Costco Tire Quality Seconds/Blems??

I have Michelin defenders purchased from costco on my Toyota camry, honda civic and Subaru outback. The ones on the Subaru were purchased 3 months ago. No problems with noise on any of the cars.
by DSInvestor
Sat Dec 22, 2018 9:41 pm
Forum: Personal Investments
Topic: Roth conversions while contributing to 401K
Replies: 10
Views: 591

Re: Roth conversions while contributing to 401K

If currently in state with high income tax and considering move to state with low or no income tax, it may make more sense to convert once you've moved to the low/no income tax state. Why volunteer to prepay tax to a high income state tax?
by DSInvestor
Sat Dec 22, 2018 9:34 pm
Forum: Personal Investments
Topic: Roth conversions while contributing to 401K
Replies: 10
Views: 591

Re: Roth conversions while contributing to 401K

Thanks DSI; I have about 15k non deductible as part of my IRAs that I have kept track of via form 8606 but it is not isolated, so yes I am resigned to needing to keep track of my pro rata basis going forward. If your current 401k allows for inbound rollovers, you can do a rollover into 401k of some...
by DSInvestor
Sat Dec 22, 2018 8:45 pm
Forum: Personal Investments
Topic: Roth conversions while contributing to 401K
Replies: 10
Views: 591

Re: Roth conversions while contributing to 401K

Currently in the 24% marginal bracket. Now starting a Roth conversion plan. Will work for another year or two. IRA balance is about 1/2 our 401K balance. Small balance in non deductible IRAs. State allows for deductibility of my 401K. Thinking a viable strategy is to do Roth coversions from my IRAs...
by DSInvestor
Sat Dec 22, 2018 3:21 pm
Forum: Personal Investments
Topic: Can I open a SEP-IRA? Already did backdoor roth
Replies: 6
Views: 361

Re: Can I open a SEP-IRA? Already did backdoor roth

SEP-IRA will interfere with backdoor Roth IRA's Roth conversion step because SEP-IRA balances at year end are considered by form 8606. Since you have already done the Roth conversion in calendar 2018, your 2018 tax return will include 2018 8606 which will look for IRA balances in Traditional IRA, Ro...
by DSInvestor
Fri Dec 21, 2018 4:24 pm
Forum: Personal Investments
Topic: Stupid backdoor roth IRA question
Replies: 5
Views: 395

Re: Stupid backdoor roth IRA question

The $ came into my account after I converted. I guess I have to then pay tax on the converted .40 cents or what? I guess I thought I could only convert $5500 per year? If you convert 100% of the account, the extra amount of interest moves to Roth IRA as well. If you convert $5500, that leaves that ...
by DSInvestor
Thu Dec 20, 2018 6:33 pm
Forum: Personal Finance (Not Investing)
Topic: Stop extra mortgage payment and put into taxable account?
Replies: 29
Views: 2484

Re: Stop extra mortgage payment and put into taxable account?

I started aggressively paying down mortgage because I lost money no matter what I did. I'm also trying now to follow buy/hold strategy buying index funds and not worrying about it. I still can max out my retirement and add to my taxable while putting extra money towards mortgage so I guess I should...
by DSInvestor
Wed Dec 19, 2018 5:18 pm
Forum: Personal Finance (Not Investing)
Topic: Cell Phone Plan/Carrier Recommendation?
Replies: 26
Views: 2077

Re: Cell Phone Plan/Carrier Recommendation?

I use cricket wireless (uses AT&T network) and have been pretty pleased. We had great signal in most places when taking cross country road trips. Our plan also allows us to use our phones in Canada and Mexico without fear of roaming charges. internet speed is capped at 8Mbps which is plenty for us. ...
by DSInvestor
Tue Dec 18, 2018 9:32 pm
Forum: Personal Investments
Topic: Confirmation of backdoor Roth before pulling trigger
Replies: 6
Views: 281

Re: Confirmation of backdoor Roth before pulling trigger

You'll need to file form 8606 for those prior years as the IRA basis accumulates. For example, the $5500 IRA basis from 2016's 8606 form flows into line 2 of the 2017 8606 form, which in turn flows into line 2 of the 2018 form 8606. You can find prior year versions for these forms and instructions a...
by DSInvestor
Tue Dec 18, 2018 9:29 pm
Forum: Personal Investments
Topic: Windsor II Fund Today
Replies: 1
Views: 335

Re: Windsor II Fund Today

Dividend and capital gains distributions.

Investor shares: https://investor.vanguard.com/mutual-fu ... ions/vwnfx
Admiral shares: https://investor.vanguard.com/mutual-fu ... ions/vwnax
by DSInvestor
Thu Dec 13, 2018 11:44 pm
Forum: Personal Investments
Topic: Question about Spousal Roth
Replies: 2
Views: 227

Re: Question about Spousal Roth

They must file their taxes as married filing jointly (MFJ) in order for her to make spousal IRA contribution (i.e. based on income of spouse). Keep in mind that their combined income is considered to determine Roth IRA eligibility when they file as MFJ.