Bogleheads.org

robbierob03 wrote: ↑Fri Feb 17, 2023 11:07 am I choose to keep my Citigold relationship with investments in a brokerage account I opened for a bonus, and with maybe $20 in the required checking account.

Interested in Citigold. What kind of brokerage do you have with Citi? Of course, we don't want Wealth Management. Do Self Invest balances qualify for Citigold?

I have an application for my benefits to begin at age 70 saved. I used the remark language shown above (updated for current dates), but did also note that my spouse will be also filing for a switch from own benefits to spousal status at the same time. A few screens prior to filing in the remarks section, there was a page about previous filing for benefits that I felt uncertain about. Have you previously applied for Medicare, Social Security, or Supplemental Security Income? X Yes _ No Which type of benefits" Please select all that apply X Medicare benefits X Social Security benefits _ Supplemental Security Income benefits Did you previously apply on your own Social Security Number? _ Yes _ No I previously applied for Medicare under my...

Can you tell us more details about your Citibank setup? Is your brokerage a Citi Self Invest Account, and does that qualify you for Citigold? Do you have Citibank branches near you? Parking a $200k IRA for annual benefits doesn't sound too bad.

stocknoob4111 wrote: ↑Tue Jan 10, 2023 7:05 pm Power, Security, Flexibility, Stability... And of course you can run containerized workloads using Docker/Kubernetes/containerd which is pretty damn amazing

Haha, this is probably the right answer. If you ever tried to do Docker/Kubernetes on Windows, you'll probably want to leave the industry. Most servers run Linux.

Rolling the after tax 401k to a Roth IRA (either direct or via a temporary stop at the Roth 401k) makes the money more liquid. If done optimally, the contributions can be withdrawn at anytime with no tax and no penalty.

https://thefinancebuff.com/rollover-aft ... 9-1-2.html

See https://www.bogleheads.org/wiki/Kiddie_ ... ned_income, but note that the wiki has already been updated for 2023. For 2022, the standard deduction and amount taxed at the child's tax bracket are both $1150.

Let's look at an example for 2022, assume:
$501 dividends
$1700 long term capital gains

The 1st $1150 is standard deduction.
The 2nd $1150, $501+$1700-$1150=$1051 is taxed at the child's tax rate. Since The $1051 is long term capital gains, it is taxed at 0%.

So the tax bill in this example is $0.

The Kitces article agrees with the consensus here that earned income is a requirement to convert 529 funds to a Roth IRA:

"the transfer rules require that the child have compensation - such as from a summer or part-time job - in order to make the transfer, such as would be required for them to make a 'regular' Roth IRA contribution"

Qualifying as a real estate professional, which requires working 750 hours annually in qualifying real estate activities (e.g. managing your properties), allows you to deduct passive losses.

You don't see much discussion because most folks have full time normal jobs (and part time real estate investments) so we can't document spending that much time, and are left to deferring passive losses to future years.

Generally, you want tax advantage and liquidity. A mega backdoor roth has less liquidity than a backdoor roth (5 year holding period after conversion), but more liquidity than a roth 401k (5 year holding period vs 59 /1/2). If I am not mistaking, this 5 years rule (there are many) only applies to the taxable amount of the conversion (often pennies or 0). There is an order to the future withdrawals, but you can make it 0. In my case my employer converts from after tax to roth on the same day automatically. Hence 0 taxable event and no money subject to the 5 year rule. The principle is always available. Thanks for bringing this up! The penalty for withdrawing within 5 years is on the taxable amount (e.g. earnings) before the conversion. So i...

Can you max out the roth 401k? If not then the easy answer is stick with the traditional. If you can comfortably max out both backdoor roth and roth 401k, then your options are: 1. Max out a roth 401k 2. Max out traditional 401k and invest the savings from the 401k tax deferral in a taxable account Assuming that your marginal tax rate doesn't decrease, and tax laws don't change too drastically, then maxing the roth 401k is more efficient because it has a higher effective contribution limit, as described by The Finance Buff: https://thefinancebuff.com/roth-401k-for-people-who-contribute-max.html You can plug in your assumptions about future tax rates yourself: https://sheet.zohopublic.com/sheet/published.do?rid=hd3vbee16c938134d45b1bd758e37d...

Your analysis of comparing the marginal 22% tax rate vs effective 13% tax rate is flawed. You should only consider marginal rates.

Reasons to not convert: https://thefinancebuff.com/case-against-roth-401k.html
Also, if you have to liquidate part of your IRA to pay the additional taxes, then you might as well not convert.

The only reason for you to convert would be no RMD's. However, it's better to wait to convert when you are in a lower tax bracket.

From the wiki:

"In any case, you have until December 31st of the tax year in which you make the backdoor Roth IRA conversion to dispose of the traditional IRA. If you still have a traditional IRA balance on December 31st, then the pro-rata rule will apply to the conversion."

https://www.bogleheads.org/wiki/Backdoor_Roth

At a high level, the mega backdoor roth is similar to a backdoor roth ira and roth 401k. If analysis tells you that you should contribute to a ira/401k, then the same analysis likely also applies to the mega backdoor roth. Generally, you want tax advantage and liquidity. A mega backdoor roth has less liquidity than a backdoor roth (5 year holding period after conversion), but more liquidity than a roth 401k (5 year holding period vs 59 /1/2). Having funds in a roth IRA is generally better than having funds in a taxable account. There are minor factors such as discrimination testing, differences in expense ratios, inability to harvest losses, and less protection from creditors. If you want to optimize, max out your backdoor roth before you i...

If your plan allows, you can rollover your $35k contributions to a roth IRA, and rollover your $130k gains to a traditional IRA. If you had taken this action sooner much of that gain could have been tax free.

Since you don't plan on backdoor roth, you can leave the traditional IRA alone until RMD's.

"Best type of loan" is subjective. Many folks around here think the best type of loan involves a 100% down payment.

Assuming you qualify for the loan, the major factors that you control are:

1. Down payment
2. Loan amount

Generally, a higher down payment gets you better rates, and a larger loan amount gets you better rates.

For investment properties, down payments range from 15% to 75%. 25% is a sweet spot.

all of them terminate into a box in the mechanical room in the basement, but they aren’t plugged into anything. "Terminate" is a technical term. Ethernet cables are terminated at a patch panel like: https://www.amazon.com/Legrand-Theater-Network-Interface-AC106A6/dp/B08PHQP75F/ref=sr_1_4?keywords=onq+panel&qid=1669954223&sr=8-4 Each of the small 8 wires inside a ethernet cable is punched down into the patch panel. The patch panel converts the wire to an ethernet RJ45 connector. Assuming that's what you already have, you can follow the suggestions in this thread. If you don't already have the cables terminated at a patch panel, then you can hire an electrician or buy network supplies at home depot and strip/punch down the ...

triyoda wrote: ↑Mon Nov 28, 2022 11:48 pm I was thinking maybe I just offer them $2K and promise not to sue me, does that sound crazy?

Sure, you could be generous and offer compensation to make up for the time the seller lost. The mechanics might be a little weird - do you create a new contract to prevent suing, or do you deposit the 2k as earnest money, and then rescind the original contract giving up your 2k in earnest money? If the seller intends to sue, they will despite nice gestures on your part.

A common technique taught at unscrupulous get-rich-quick real estate seminars is to lock up a a property in contract, never deposit earnest money, and try sell the contract to an investor. Most of the time, sellers won't waste time and money to enforce to contract.

If you intend to back out, it is better to back out sooner rather than later for the other parties involved. The seller would lose 2 days of the property being off the market, rather than a week to a month due to backing out from inspection or finance contingency.

You are in breach of a signed contract, so the seller could sue and force you to buy the property, which is not terrible since if you didn't back out you be buying the property anyway. Chances are, they seller would not waste time suing unless you really pissed him or her off.

1) We have about $75K in depreciation from renting this house out in recent years, we bought the house for $150K. Do we owe depreciation recapture taxes? You owe unrecaptured section 1250 gains. 2) Could we gift them the difference ($450K - $200K) $250K? Do we owe gift taxes on the $250K or will it be counted into the lifetime exclusion? Lifetime exclusion. 3) What's the mechanics for doing this? We planned on doing a quit-claim deed to transfer the title. Have our accountant to do the $250K gift tax return. Depending on your comfort level, you could do one of: 1. Record a quitclaim, and receive cash from your relative 2. Write and sign a contract, and then hire escrow to calculate prorated amounts for property tax, and record the deed and...

Disneyland tickets must be purchased, and reservations must be made. Weekends are crowded, so if you wait until the last minute, chances are reservations will be full even if you have tickets.

You can check best times to go at: https://magicguides.com/disneyland-crowd-calendar/

Even with the recent price increases, expect long lines (1-2 hours for popular rides), or plan on purchasing genie+ and/or lightning passes.

1. From https://www.bogleheads.org/wiki/Inherit ... ax_factors, "The five year threshold is met on January 1 of the anniversary year." Since the parent opened the IRA on November, 2021, the five year threshold is satisfied on January 1, 2026 (slightly less then 5 years).

2. From https://www.bogleheads.org/wiki/Inherit ... eficiaries, "you cannot treat the inherited IRA as your own." Therefore, the sibling must wait 5 years after opening his/her own IRA for it to become qualified. The inherited IRA is not his/hers, it is owned by the deceased for the benefit of the beneficiary.

If the rate were 0%, would you pay off your loan to feel better?

3.9% is an excellent rate, especially for commercial. Some money market funds, such as https://fundresearch.fidelity.com/mutua ... /31617H805 are yielding over 3%.

If you are risk averse, then arbitrage and buy CD's or short term treasury notes which both yield slightly more than your loan rate.

If you have risk tolerance and you have already you have maxed out your tax advantaged space, continue to invest in your taxable account.

In all cases harvest your tax losses.

It's best to check tire pressure in the morning before the vehicle is driven since it takes several hours after driving for tires to cool.

Ambient temperature and elevation do affect pressure, but not by much. It's much better to be overinflated than underinflated.

MikeZ wrote: ↑Tue Aug 30, 2022 8:33 pm

mogg wrote: ↑Tue Aug 30, 2022 8:11 pm

MikeZ wrote: ↑Tue Aug 30, 2022 11:38 am I am doing the Fidelity in place Roth conversion. From what I am seeing, that is not an option.

Is that your opinion, or has a Fidelity retirement specialist told you that you cannot rollover to an IRA?

If your former self had done such rollovers in the past, you'd be well positioned to purchase a house now. You can position your future self to buy a house by rolling your 401k to an IRA going forward.

When setting up the in place worth conversion I asked if I could roll over the in plan Roth conversion to my Roth IRA and was told no. Is there a different question I should ask?

You could also ask if you can rollover the aftertax 401k to a Roth IRA.

MikeZ wrote: ↑Tue Aug 30, 2022 11:38 am I am doing the Fidelity in place Roth conversion. From what I am seeing, that is not an option.

Is that your opinion, or has a Fidelity retirement specialist told you that you cannot rollover to an IRA?

If your former self had done such rollovers in the past, you'd be well positioned to purchase a house now. You can position your future self to buy a house by rolling your 401k to an IRA going forward.

cchrissyy wrote: ↑Mon Jun 27, 2022 9:27 pm layperson here, i thought if you already signed your personal name on the title or mortgage it is too late for an LLC to provide meaningful liability protection.

The main reason to not sign your personal name on title or mortgage is to provide lawsuit protection by hiding yourself as an owner. If lawyers cannot determine who to owner is, it is harder to sue. For example, it is currently hard to determine which Russian oligarchs own which yachts.

For many of us, this is not realistic because:

* We need mortgages by buy property, and personal mortgages are cheaper than business mortgages
* LLC's are complex and expensive - each property has a separate LLC, bank account, tax return, etc

IANAL Fidelity supports these registration types: * Joint Tenants With Right of Survivorship (WROS) * Joint Tenants in Common * Joint Community Property * Joint Tenants by the Entirety You can see these registrations by going through the web interface to change your registration online: https://www.fidelity.com/customer-service/how-to-change-registration Joint Community Property does not imply right of survivorship: "Each spouse has an equal interest in the property" "Upon divorce or death, the property is treated as belonging half to each spouse." Joint Tenants by the Entirety does imply right of survivorship, but is only available in about half of the states, and typically not the community property states. For communi...

Any thoughts on using the Upgrade debit card for 1% cash back? https://www.upgrade.com/rewards-checking/

Seems similar to the discover 1% debit card.

1. Switch cost basis to actual cost so that you can sell specific shares. 2. Default disposal is less important since you'll select specific shares. Any of the High-Cost / Tax-Sensitive options will result in the correct sort to harvest losses. 3. Let's say you and your spouse have FZILX in both your taxable and ira accounts. - On 12/30/21 you tax loss harvest your taxable account. You probably committed a wash sale because your taxable account had a distribution that you re-invested earlier in December. You learn your lesson, and turn off reinvestment in your taxable account. - On 12/30/22 you tax loss harvest your taxable account. You probably committed a wash sale again because your ira account had a distribution that you re-invested ear...

OP already is in contract to buy the house, the biggest advantage of paying with cash (negotiating a lower price) is gone.

Purchase mortgages have better rates than refinance mortgages. Therefore, proceed with your plan and get a mortgage now if you can. You can always refinance later again to draw cash out.

Standard pyramid scheme. You pay a lot for training on how sell overpriced insurance and investments to family members and close friends. Afterwards, you will have no family or friends, and revenue probably won't even over the cost of training.

Some well written explanations: https://thefinancebuff.com/case-against-roth-401k.html Summary: If you can deduct contributions to a traditional IRA, do it. Otherwise do a roth. Since you don't qualify to deduct IRA contributions, you should do a backdoor roth. https://thefinancebuff.com/the-backdoor-roth-ira-a-complete-how-to.html Summary: Optimally roll amount in tradition IRA that would be taxed into 401k as investmax mentions. Then convert your traditional IRA to a roth with no tax consequences, other than having to file. 1. For low income, contributions to traditional IRA are tax deductible - sounds like it doesn't apply to you. 2. Many bogleheads save a lot. Max-ing out traditional 401k's by itself often causes income in retirement to...

The only way to get the current market price of a home is to put it on the market. Appraisers will look at past sales to value a home, so they will tell you what the value was a few months ago, which could possibly be close but different from what the value is today.

If you want to save on commission, look for a flat fee listing where you pay a few hundred to list, and a percentage to buyer's agent.

If you want to sell to the cleaning lady, ask her for a pre-approval just like you would ask any other buyer.

I'm biased, but I much prefer an irrevocable trust instead of a UTMA for a lifetime of planned gifting. It can last hundreds of years and you can make it intentionally defective. I don't intend to give enough to heirs to implicate the gift and estate tax. Specifically, I intend that most of what my son receives from myself and my wife will be received during our lifetimes, in the form of childhood support, a college education, and the 20s fund, with a significant, but not an extraordinary (certainly below the overall exemption), amount received at death. I would also provide for a college education for grandchildren, if lucky enough to see the day. The rest will likely go to charity. I do generally try to keep under the annual gift tax exc...

Options (from cheapest, to most expensive)

1. Simple transaction
- Partner refinances the property in his/her name
- At some point in the future, partner pays you for your share of equity, and you quitclaim deed to him/her

2. Pay escrow to calculate fair share of sale
- Write sales contract where you and parter sell property to partner
- GIve contract to escrow
- Partner applies for purchase mortgage
- Sale closes, you get your share of equity

3. Pay escrow to calculate fair share of sale, pay real estate agent to create contract
- Same as 2, except that you pay real estate agent to create contract

4. Pay escrow, pay real estate agent, pay lawyer
- Same as 3, except you also pay a lawyer to go through your legal options

capran wrote: ↑Mon Dec 27, 2021 12:03 pm In Washington the Exclusion amount is $2,193,000 but they do not include the residence

Do you have a reference for this? Based on https://dor.wa.gov/taxes-rates/other-ta ... te-tax-faq, the applicable exclusion on real estate is debt, so unless the residence is 100% mortgaged, it appears to be included in the Washington estate.

systemr wrote: ↑Thu Sep 16, 2021 9:28 pm i'm at 1.05%, if you have a large enough account and are planning to take a margin loan they will try and match IBRK pro as best as possible.

How much is a "large enough account" at Fidelity?

Concentrate on finishing the mortgage. You did well by asking to add her to title, but that might cause problems with the lender. Just do what the lender wants. Sometimes a spouse will need to sign the deed of trust. Sometimes the lender will want to add the spouse to title. Sometimes the lender will want the spouse to sign a quitclaim deed, so it's clear she doesn't have any interest in the house.

It doesn't matter, do what the lender wants. You can easily add her to title via a quitclaim deed afterwards, might cost 100-200 to record with the county.

Or as others have mentioned, a will is an easier and a cheaper option.

CurlyDave wrote: ↑Sat Jun 19, 2021 9:36 am
DW and I just did something very similar. We refinanced our personal residence and 3 multi-family rental properties. 30 year loans, 2.5% on the residence, 3.25% on the rentals.

Easy-peasy, no problems at all.

What bank did you use for your mortgage?

Ideally you should not add your name to the mortgage. Adding your name to the mortgage might increase your score - having credit history is good. It might not increase your credit score if you already have sufficient credit history. It will decrease your credit score because of the inquiries. The mortgage would weigh you down for future credit applications. Even if you have income in the future, the income would have to overcome the mortgage payment for you to qualify for future credit. The only logical reason to add your name to the mortgage would be to use your assets. Since your wife doesn't have the down payment in your name, you'll want to deposit your business sale in your/your wife's joint account for two months to let the funds age....

I'd love to get extra income, but as a boglehead I only have mutual funds (e.g. FZROX, FSKAX, etc). Mutual funds aren't eligible for Fully Paid Lending Programs, correct?

There is nothing special about a non-owner occupied HELOC. The rates are higher and the LTV is lower, fewer banks offer them, just like a non-owner occupied primary mortgage. Third Federal and penfed are good lenders, as well as local credit unions.

Generally the borrower signs the note, and for deed of trust states everyone on title signs the deed of trust.

Advantage of 1 borrow: The mortgage only shows up on own credit report, so the other owner can go out and get a mortgage for a 2nd home.

Advantage of 2 borrowers: The bank can go after both of you if you the mortgage isn't paid (advantage to the bank). If a single borrower doesn't qualify, this is the only option.

Appraisal contingency means that if the house appraises for less than an amount, then you as the buyer can back out. You might negotiate with the seller - hey buddy, your house appraised for $300, will you agree to reduce the price to $315 or else I the buyer will back out.

It doesn't mean that the seller has agreed to sell it to you for $315.

Yes, as a cash buyer you an hire any appraiser you like.

You can transfer the house to a trust relatively easily after purchasing via a quitclaim deed. The recording fees are the biggest expense.

A trust creates problems for both financing and refinancing. Many banks will only lend to people, not trusts. If you are buying with cash, this is not an issue.

Creating a trust before purchasing is a good way to hide your identity as the owner if that is your goal. If the trust purchases the property, then there is no public record that you are the owner, as long as you are not the trustee.

When refinancing a property owned by a trust, many people quitclaim from the trust to themselves, refinance, then quitclaim the property from themselves back to the trust.

sport wrote: ↑Tue Jan 19, 2021 6:41 pm

mogg wrote: ↑Tue Jan 19, 2021 5:41 pm Costco generally does not sell GIA diamonds, so Costco should probably be avoided.

joebruin77 wrote: ↑Tue Jan 19, 2021 4:51 pm Most of the rings sold at Costco include the GIA certificate, as well as shipping and handling.

There seems to be a difference of opinion. Here is one that specifically states it includes GIA certification:
https://www.costco.com/princess-cut-1.0 ... 16654.html

I stand corrected, most costco diamonds 1 carat and above include a GIA certificate, smaller ones do not.

If future wife wants a Tiffany and doesn't care about other factors, then get a Tiffany. Some people are only happy with Tiffany's. If you or future wife want best bang for the buck, then get an a diamond form a reputable online retailer (blue nile, whiteflash, jamesallen, etc). Of the C's Cut is most important since it makes diamonds sparkle. Next is is Carat since you can see how big a diamond is. Next is Color, but color isn't very important since it's hard to see the color after the diamond is mounted. Generally you can evaluate color of the diamond by looking a the bottom of the diamond. Finally, Clarity is unimportant since no one is going to put the diamond under a magnifying glass to see its imperfections. Get a diamond with a GIA (...

Refinances have fixed costs such as loan application fees, appraisal fees, title insurance, escrow fees, and recording fees. With a low balance, the fees would make a significant portion of the loan. You could refinance at a lower rate, but you would be paying a loan costs of about $3000, which may not be worth it. Might be better to use that $3000 to pay down the loan.

An alternative might be to refinance using a HELOC since as Third Federal.

You're basically an expert at single family rentals. Keep buying single family rentals, preferably in the same area since that is your competency. Don't branch out into multi-unit rentals - cash flow may be higher, but they come with their own set of unique problems. Investing in cheaper areas may generate better returns, but not worth the travel expense for maintenance. Some key ratios that some lenders care about: 20% down for mortgages 25% down for to get better rates on mortgages 43% max DTI on jumbo loans 50% max DTI on conforming loans If you don't want to pay depreciation recapture (technically section 1250 gains) then depreciate to 0, and then step up and pass to your children. As you are already thinking, you should prioritize tax ...

The wiki is accurate. Hopefully, SpiritRider will chime in.

Examples for 2021:
2,200 in long term capital gains: 0 tax
2,200 in earnings: you pay tax
2,200 in short term capital gains: you pay tax

You file if you earned income from employment, or if you sold investments. If you only receive dividends/capital gains distributions from mutual funds, the no need to file if you don't owe.