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I’ll start by saying that if your parent or you do not fully understand these complicated arrangements that you need to set up a consultation with the attorney to review them again. I don’t understand your parent’s set up (but I am not an expert) especially if the attorney is saying their income is too high to qualify for Medicaid LTC benefits in the future. Medicaid and estate planning vary by state. I can only give you my (long) version of events in my parent’s state (not NY) which may or may not help you make sense of your parent’s Trust arrangement. My parent did not have a LTC policy. An irrevocable trust for Medicaid purposes usually involves moving the title of some or all Taxable assets to a properly-constructed trust to avoid the a...

It’s not unusual for IRS correspondence to arrive separately and at a different time than a tax refund or bill.

Before calling the IRS, have you logged into your IRS.gov account to review your 2022 tax transcript and to compare it to your tax return as filed? You will probably be able to see if any line items were adjusted by the IRS that changed the amount of tax due. You may still need to call for an explanation but at least you can direct the agent to the adjusted line which may shorten your call.

For an objective view on your portfolio and whether there are any tax red flags, consider posting using the “Asking Portfolio Questions” template found here:
https://www.bogleheads.org/wiki/Asking_ ... _questions

Is it possible your dad received two checks that total to the amount on the Form 1099-R?

Asking the issuer to explain the amounts and to correct, if necessary, the Form 1099-R is the appropriate first step. If you believe it is incorrect and the issuer does not issue a timely corrected Form, read this IRS Tax Tip for guidance:
https://www.irs.gov/newsroom/what-to-do ... x%20Return.

I don't want to derail my own topic too much but I am wondering - I'll be on Medicare this time next year, is the ACA even relevant at that point? My wife will just use my company's retiree medical for 2-3 years until she can start Medicare. I revisit the Roth conversion decision every year as variables (such as my ACA subsidies) in my analysis change from year to year. So just revisit your Roth conversion analysis annually. You/your spouse have such a short window until Medicare eligibility that likely ACA subsidies will not factor into your Roth conversion decisions for each of the next 2-3 years. If, worst case, the retiree health coverage was discontinued or the cost was higher than subsidized ACA coverage, then you might choose to tak...

Most of the cafeteria benefit plans that I have seen have boilerplate language that says in the event of conflicting language in agreements, the benefit plan agreement language prevails. One reason for this is to keep the cafeteria plan from jeopardizing it’s qualified tax status by not allowing special one-offs in a cafeteria plan that is meant to be applied to all employees consistently. If you really want the legal answer, you need to send both agreements to an experienced employment practices attorney. My non-legal opinion is that if the 401k plan says former employees receive the true-up even if not employed as of the date the true-up is made, you are fine. But learn from my example, below… My spouse and I (not attorneys) almost got bu...

What I don’t understand is how I am not named fiduciary with the state plan but will need to be named fiduciary with my own plan through a provider. I don’t see what the difference is on its face. The plan provider has liability if they function as the named Plan Trustee and/or Plan Administrator. There used to be third-parties that would take on the fiduciary Trustee function for small plans if the plan provider would not assume these functions. When I priced the third-party option about 10 years ago, the fee was $10k for a plan with 35 participants. If you use Vanguard for the higher fee, do they act as the Plan fiduciary? If you take on the fiduciary function, look into whether your business liability coverage covers you as the 401k fid...

Is this a revocable trust or an irrevocable trust? If an irrevocable Trust, was part of the purpose for establishing the Trust to remove assets from the reach of Medicaid if needed in 5+ years for your parent’s care costs? In addition to the house, were all Taxable accounts retitled into the name of the Trust and is the Trust the primary beneficiary on all retirement accounts? Are the long-term care benefits per the LTC policy good if your parent needs them? Or is it’s primary purpose to pay a death benefit to you and your brother if the Estate is depleted? If the latter, if your parent receives Medicaid LTC benefits in the future, will Medicaid allow your parent to keep the policy in order to be eligible for benefits or for you/sibling to ...

Besides yourself, you have three people dependent on your salary and portfolio. If you decide to take a break or retire from work, at least secure your financial future by diversifying out of the volatile single stock. In the meantime, don’t hang your hopes on leaving only if they pay you severance. Consider telling your boss you will be in the office only 1 or 2 days per week, wfh the rest, keep your hours to a reasonable # no matter how many former employer jobs they try to shift to you and your co-worker. The worst they can do is fire you. Polish your résumé and see what else is out there regardless of whether you receive severance or not. Another job for a couple years will give you time to beef up your portfolio and unwind your single ...

Is the $7k just legal fees or does it also include some pass thru expenses paid by the attorney on the estate’s behalf such as court/probate fees, newspaper notices, etc.?

BashDash wrote: ↑Wed Mar 22, 2023 9:28 am Homestretch.....that has me thinking.....the loud bangs aren't sounding like they are literally coming from the laundry machine but nearby in the laundry room where there are a lot of pipes in the ceiling by the furnace etc.

It’s a process of elimination. The arrestors are inexpensive so I’d try those first and it may completely solve your issue.

If not, check the the nearby pipes. They may need to strapped on to a nearby joist/beam to reduce the jumping /hammering. You can check any visible pipes near the furnace when you hear the hammering to see if you can see any big movement in the pipes.

… I'm not following the ACA considerations since I was planning on using my company's retiree medical. … If I'm reading the ACA information correctly, I'll get some subsidy but even with a subsidy it's ~3X higher than my retiree medical. … If company retiree coverage is better/less expensive than a subsidized ACA plan, certainly go with the company plan. With a MAGI of $90k, for a household of 2 you likely won’t qualify for an ACA subsidy in future years if the 400% FPL subsidy cliff is reinstated as scheduled in 2026. Your retiree plan may also not allow you to enroll later if needed, if declined when first eligible. Without the ACA subsidy factor, you will have one less consideration when deciding about Roth conversions. In my case, as I...

Stainless burst-free hoses are a good idea.

If a plumber installs the arrestors, have them wait while you start a laundry cycle to be sure the hammer sound is eliminated.

I was going to try the arrestors but turns out my loud
water hammer was due to a pex water line (near other pipes in a chase) leading into the laundry room that was jumping/hammering when my new high efficiency washer first started a wash cycle.

Going forward, consider taking screenshots of brokerage transactions just in case.

A few years ago, Vanguard had issues with trade confirmations incorrectly using average cost rather than specific ID. I was affected. Luckily I screenshot all brokerage transactions entered so it was easy to prove their error and have Vanguard correct the issue (not all posters were so lucky).

To add to the above good feedback…
If your state has mandatory tax withholding on retirement distributions, you may be able to waive the withholding by submitting a form to the brokerage when requesting the distribution.

No. At your mom’s age, preservation of capital is a high priority. Owner financing is riskier than getting the cash in full upfront. Your mom’s well off friends with great jobs should be able to secure a bank loan.

Has your mom listed the property? Does she have any other offers?

Welcome to the forum! … Tax Rate: 22% Federal (12% after deductions I believe); 6.5% State … It is helpful to know whether your Federal marginal tax rate is 12% or 22%. What is the $ amount on your 2022 Form 1040 Line 15, taxable income? If it is between $20,550 and $83,550, your 2022 rate was 12%. If it is between $83,550 and $178,150, your rate was 22%. You can edit your original post to show the correct rate. … Contributions: New annual contributions for 2023 $~23,000 to his roth 401(k) (total from my 10% contribution and resultant employer match) $6500 to his Roth IRA… $7750 to his Health Savings Account ($1250 from employer)… Excluding your employer’s 401k and HSA contributions, are you saving at least 15% of your gross income annually...

Welcome to the forum! For best feedback, post your full financial picture using the “Asking Portfolio Questions” template found here: https://www.bogleheads.org/wiki/Asking_portfolio_questions Sounds like you are taking advantage of most options available to you to defer income/taxes: 1) 10-year payout on your business sale 2) 401k 3) defined benefit plan I-Bonds (see link, below) offer the ability to defer taxes but annual purchase limits are low. https://www.bogleheads.org/wiki/I_savings_bonds With a workplace 401k, your income is too high to make a deductible IRA contribution or a direct Roth contribution. But you likely can do a backdoor Roth (see link, below) for the years you have eligible compensation via W-2 or 1099 self-employment ...

+1 to Treasuries and no substantial gifting to family as safe choices.

Is this $300k your parents total nest egg?

While your parents’ current income covers all expenses now, it’s possible their care costs may increase substantially. Do your parents have a long-term care policy?

vanguarded wrote: ↑Tue Mar 21, 2023 11:34 am So medigap is no longer available for someone hitting 65 in August 2023? Does this mean they only really have to use those medicare advantage plans now? Was advised a few years ago to look at medigap and steer clear of the all in one advantage plans...

No, Medigap is still available. This thread is about just a couple of the Medigap plans that were closed to new enrollees which is not uncommon.

Is there a concern that the Plan F yearly premium increase will be higher then the normal since no younger and healthier people can purchase Plan F? If so, have you looked at other Medigap plans and are your concerned you live in a state that requires medical underwriting if you switch Medigap plans and may not be able to switch plans? It’s a concern. My parents’ Supplement Plan J was discontinued for new enrollees after 6/1/2010. My elderly parents didn’t look at alternatives as they were heavy healthcare users and subject to underwriting so they remained in the plan for another 12-13 years. Their supplement through United Healthcare had annual increases but no idea if the increases were more or less than other supplement plans. The premi...

seanbaby wrote: ↑Mon Mar 20, 2023 10:52 pm … It is wise to rollover to an IRA …

Another option is to rollover the two old 401k account balances to your current employer’s 401k, assuming it allows rollovers in and has good funds/low costs.

Spouse 2 should consider consulting with an experienced elder law attorney in her state.

Before using the proceeds from Spouse 2’s primary residence… Has Spouse 2 looked into whether Spouse 1 is eligible for Medicaid LTC benefits and if Spouse 1’s facility accepts Medicaid assignment?

… And I'm not sure how frequently those involved realize that a regular POA may actually cease at incompentency, when it might be needed more than ever. … RM, under what circumstances will a durable (I think this is what you meant by “regular”) power of attorney cease at incompetency of the grantor? I guess there is always the possibility where someone not named in the DPOA applies for a conservatorship. Sorry that I wasn't more clear. No, a "regular" POA is not a Durable POA. I don't know a more specific name for what I call a "regular" POA. That's one that is in effect "right now". It ceases at death, and, importantly, it also ceases at incompentency, which is when it would often be most wanted. The DPOA (Du...

ResearchMed wrote: ↑Mon Mar 20, 2023 6:37 am … And I'm not sure how frequently those involved realize that a regular POA may actually cease at incompentency, when it might be needed more than ever. …

RM, under what circumstances will a durable (I think this is what you meant by “regular”) power of attorney cease at incompetency of the grantor?

I guess there is always the possibility where someone not named in the DPOA applies for a conservatorship.

HomeStretch, thanks for your comments. Being totally new to this, I didn't understand that Medicaid would have any part in this, so I appreciate you bringing that issue to my attention. We did recently have a meeting with their estate attorney, who feels that everything is in order– they have a trust, everything is properly titled, etc.– but neither Medicaid nor dementia care was discussed. It sounds as though there is some strategy there, which we would do well to think about sooner rather than later. … The estate attorney and the elder law attorney often have functional overlaps but also different areas of expertise. For example, my parents’ estate attorney used the state statutory form for their durable power of attorneys (DPOA). But wh...

#4 seems like the simplest.

She can likely earn 5% in T-Bills or a bit less in a money market fund. If she moves the bulk of the $, she could be earning an extra $8k-$9k/year in investment income.

Edit - wherever your mom has $, be sure to get your mom’s POA on file or agent access set up so that the financial institution recognizes you as her legal representative.

I’m seriously considering picking a future date certain and getting our adult children involved more intimately in our finances at that point. That date would he well before we’d be likely to actually need significant help. But I’m also concerned about “being the last one in the room” to know that I/we are no longer capable of managing our finances. … I think this is a very good plan and one I intend to use too. My mom asked me to take care of their investments and taxes in her mid-70s. When my dad was diagnosed with dementia a couple years later, she asked me to take over bill pay, insurance renewals, etc. I was glad she did this early before my dad became fully incapacitated. By the time they later needed more help with healthcare and ca...

I like BoA’s Bill Pay and statements better than the Fidelity CMA. Try out the Fidelity CMA for a couple months before deciding whether to switch. Consider holding excess cash in your Fidelity brokerage or CMA where it can be invested in higher-yield fixed income investments like a money market fund or T-Bills. Set up a bank link at Fidelity do you can transfer $ between the two accounts. Keep enough at BoA to pay 1-2 months of bills and avoid account fees. Alternatively, invest at least $100k of the excess funds at Merrill Edge to earn higher returns and retain your BoA preferred rewards status. With $400k at BoA know you should be a Platinum member which earns you higher BoA credit card reward % as described in this BH thread: https://www...

Silk McCue wrote: ↑Sat Mar 18, 2023 5:17 pm As I understand it and from the Social Security site…

Thanks, you are correct. I will correct my prior post.

beyou wrote: ↑Sat Mar 18, 2023 8:00 pm So how does one gather 5 years worth of statements.
Most banks show last year of statements maybe. Do people pay banks to retrieve from archives ?

It took a couple months to gather everything. I downloaded account and credit card statements monthly for my parents as their POA for the last 7 years. So I had some of the documents. For any that were missing, I contacted the issuer.

I went through my parents files to get copies of the personal documents - birth certificates, insurance cards, etc. plus asset titles and receipts for large purchases. I had to contact a few places (car and stairlift dealers) to get duplicate receipts.

Question, is it really necessary to keep 5 years of bank/broker statements to qualify for Medicaid LT care ? Meaning can Medicaid just contact your bank/broker and get the records with your permission, or just you save all bank/broker statements essentially forever to have the latest 5 year rolling statements ? I understand the purpose of a look back, just wondering about the logistics. We are just now moving my MIL $ to a trust, and wondering if we must now start keeping her personal non-trust statements every month and produce them all in 5+ years ? Your state website will tell you the paper document support that must be submitted as part of the application. I am in the middle of a state review of my parent’s Medicaid LTC benefit applica...

Edit - It is odd that your spouse’s parent was owed a SS benefit at the time of death that was then paid to the heirs rather than the Estate. Often it is the opposite situation - the Estate needs to repay the SS benefit received in the month of death.

… Now that he's developed Alzheimer's … … Where would you put this money? … Consider deferring portfolio decisions for now. Your parents have a small portfolio, your dad’s pension does not have 100% survivor benefits and your dad has Alzheimer’s. If they haven’t done so already, the first financial priority should be to set up a consultation asap for your parents and you with a elder law attorney in their state that is experienced with Medicaid to set up a plan which likely will include updating their estate documents and to preserve from Medicaid whatever assets possible for your mom as a well/community spouse. Reconsider using the house equity to pay for care. Medicaid in most/all states will allow your mom to keep her primary residence,...

Help prepare him by making sure he has/knows how to: 1) cook a few basic items for when he has an apartment with kitchen. 2) do his laundry. 3) use an ATM/write a check. Its helpful if you have access to the account in order to make deposits, if applicable. 4) has an uber/lyft account for transportation in rural areas if he doesn't have a car. 5) has a credit card for emergency purposes at least. Adding him as an authorized user also helps him build a credit record/score. 6) understands whatever loans he may be taking out and the future repayment terms. 7) good cell phone, laptop and printer. 8) has medical/dental card copies and understands how to access urgent medical care on campus or off. Help him get his dorm room set up comfortably. M...

Does your mother need a skilled nursing facility (SNF) now or are you asking for the future? Does she have dementia or require assistance with multiple daily living activities which would make her eligible for Medicaid long-term care benefits in a SNF? Some states also provide financial assistance, if eligible, for other types of facilities (for example, assisted living) or in-home care. If you foresee your mom needing care in-home or at a facility, it’s good to do some pro-active planning such as checking out facilities, getting on waiting lists and becoming familiar with financial assistance programs. Your biggest hurdles will likely be lack of funds, identifying good facilities and being admitted quickly at the time it is needed. Also, y...

… A couple of clarifications: the "ravine" (note quotes) is just an area of erosion a few inches deep where water has started to form a channel. I'd like to prevent this from getting much deeper or wider. … Catch drains/basins and pipes work but you have to remember to keep them clean of leaves and debris. Also water can change paths a bit over time which involves resetting the drains. Have you consider a swale if you have room between the two properties? Search the internet for info/pictures. It would involve widening and deepening the path that the water has created in order to channel the water from the back of your property to the storm water inlet located at the front of your property. You can landscape on the sides of the s...

Do Roth IRA Contributions Count Toward Your 401(k)? … No. … To be clear, that would allow her to make a total of $29,000 in contributions toward retirement accounts this year. … Assuming sufficient compensation, for 2023 your friend can contribute up to the IRS limits for: 1) 401k - $22,500 (<age 50) or $30,000 (age 50+), and 2) Roth IRA - $6,500 (<age 50) or $7,500 (age 50+) Talking of "sufficient compensation", my understanding is that even with a compensation of $22,500 you could contribute $22,500 to the 401(k)* and an additional $6,500 to the Roth IRA. * maybe to a Roth 401(k) not traditional 401(k) ... but I am not too sure about the reasoning either way A traditional 401k contribution reduces compensation. So if OP’s frien...

cbox wrote: ↑Thu Mar 16, 2023 6:43 am Do Roth IRA Contributions Count Toward Your 401(k)? …

No.

… To be clear, that would allow her to make a total of $29,000 in contributions toward retirement accounts this year. …

Assuming sufficient compensation, for 2023 your friend can contribute up to the IRS limits for:
1) 401k - $22,500 (<age 50) or $30,000 (age 50+), and
2) Roth IRA - $6,500 (<age 50) or $7,500 (age 50+)

In your response, you should include any tax form (W-2, 1099, etc.) with state withholding $. From your post, above, it sounds like this is just your and spouse’s Form W-2s plus your tax return. You could also include a cover letter.

If your policy does cover the fence, check the type of storm damage that is covered and also check whether it is covered at replacement cost or a depreciated value. If a depreciated value, it may not be worth a claim once you take into account your deductible.

Companies may terminate a 401k plan before a planned bankruptcy filing to shutdown operations. There’s a series of notices that go out to participants advising them to rollover plan balances. For participants who cannot be located or do not rollover the balances, the remaining funds are transferred to a custodian so the plan can be terminated after assets are fully distributed.

If not terminated before filing, the bankruptcy Trustee appointed by the Court will oversee the plan termination and distributions to plan participants.

This is one reason why it’s important for former employees with 401k plan balances to provide updated contact information to former employees (and not just the plan custodian).

Definitely seems to be some sort of issue going on with transfers out. There have been several recent threads/posts (one linked, below) about issues transferring out settled/cleared funds in a newer Vanguard account. Not exactly the same as yours as they reported receiving an online message saying the money could only be transferred out to the account it originally came from.

viewtopic.php?p=7165685#p7165685

I suggest you get advice from the attorney on how to handle the pension direct deposit. The pension deposit arriving on the last day of the month is problematic if it causes BIL’s countable assets to be >$2,500 at month-end. Is it possible to change the deposit date or request a pension check so you control the date of deposit? If not, it will be difficult to insure you can get a payment out (by wire, direct debit or bank check) the same day to keep the account <$2,500. You mention withdrawing the $93 personal needs allowance. Money withdrawn should be because it was spent on actual personal needs items. Keep receipts. Otherwise it should stay in the account (without going over $2500 at month end). Just withdrawing but not spending it or mo...

Hi, Can you please advise how to populate these in Etrade form. I want to move my solo 401 k from Vangurad to Etrade. x Existing Plan Amendment or Restatement Date This is an amendment or restatement of an existing qualified plan. The Initial Plan Document was effective on . <Is it when my current plan became effective. The date 2 years back?> You are amending your plan from Vanguard to E*TRADE. Your Vanguard Plan adoption agreement should have the initial date your business sponsored/adopted the Plan. This Plan is a frozen Plan effective on . <Is it today's date?> If this Plan is a frozen Plan, no Employer Contributions may be made to the Plan with respect to Compensation earned on or after the Effective Date that the Plan is frozen. In a...

Whether to do Roth conversions or ACA subsidies is a decision to review annually. The analysis may change from year-to-year. For example: - Next year at age 63 your analysis will also have to take into account the Medicare IRMAA tiers. - There may be years you need cash for living expenses that may reduce or eliminate the space available for Roth conversions. - In 2026 the ACA subsidy cliff is scheduled to be reinstated. My/spouse’s healthcare is through the healthcare exchange for the first time this year. My analysis looked at subsidies/taxes for various MAGI levels. I decided to keep 2023 MAGI around $115k (includes some Roth conversions) which is almost the top of the 12% bracket and allows us to be state tax-free on a portion of our Ro...

Fidelity offers a Business Account that is a brokerage account with some cash features. Your business can hold funds in the account in T-Bills, money market funds, etc. You can link the account to your business bank account in order to transfer funds between the accounts.

Edit - Fidelity allows you to auto-roll T-Bills which makes it fairly easy to keep the excess funds continuously invested in T-Bills.

For a self-employed business earning $30k max annually owned by one person/no employees, S-Corp status seems overly complicated. Consider whether it makes sense to withdraw the election (IRS Form 8832) and change to a Sole Proprietorship (SP) for tax year 2023 where profits are reported on Schedule C on your Form 1040. With a SP, here is no need to run payroll or do a separate tax return on Form 1120 (which should reduce tax preparer fees) which should lower business expenses. How can a corporation be a disregarded entity? Another solution might be to liquidate the corporation, if there won't be much gain on the liquidation. I don’t think a corporation can be a disregarded entity. My suggestion was for future tax years to consider filing w...

For a self-employed business earning $30k max annually owned by one person/no employees, S-Corp status seems overly complicated. Consider whether it makes sense to withdraw the election (IRS Form 8832) and change to a Sole Proprietorship (SP) for tax year 2023 where profits are reported on Schedule C on your Form 1040. With a SP, here is no need to run payroll or do a separate tax return on Form 1120 (which should reduce tax preparer fees) which should lower business expenses.

prd1982 wrote: ↑Sat Mar 11, 2023 8:52 pm … I'm surprised our lawyer didn't suggest doing estimated taxes for this year.

It only matters if it would have moved up your BIL’s Medicaid LTC benefit start date.

As far as the SNF direct debiting BIL’s account mid-month for Applied Income despite the pension benefit being received later at the end of the month, you can tell them to move the direct debit to later in the month. I pay by check only after all income is received to avoid this.