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The worksheet includes the Jan-Apr contributions in the ratio calculation while the 8606 does not. From reading the text of the law regarding conversions, I feel that the 8606 instructions are the "most correct" in this situation. But not all situations are addressed by from 8606 and worksheet 1-1 (and other worksheets) are necessary to figure out the amount/proportion of allowable IRA deductible and non-deductible contributions in the first place. And this does indeed lead to situations where two otherwise acceptable methods of computation lead to different results. For what it's worth, I cannot force my tax software to use 8606 even when I think it's the "correct" interpretation. For most (all?) taxpayers the actual p...

muel87 wrote: ↑Mon Mar 20, 2023 11:19 am The worksheet includes the Jan-Apr contributions in the ratio calculation while the 8606 does not.

You are correct that this example leads to different results, with the pub 590-b instructions saying to use the worksheet for this set of numbers. Not sure I can explain the difference. [EDIT: it's clear it's treating the post Jan 1 contributions differently, but not clear which method is correct]. My software forces the use of the worksheet in this situation. E.g. it follows the tax prep instructions linearly starting from publication 17 --> 590-B -->worksheet 1-1.

Hmm....

Are you saying results from worksheet 1-1 are always the same as doing the math on 8606? They contradict in my case and in many others it would seem.... [snip] Using each gives me two different taxable amounts for my Roth conversion..... Can you give an example? Because for the examples I try which have previous year contributions, the instructions in 590-B end up punting me back to form 8606. E.g. "If line 5 of Form 8606 is less than line 8 of worksheet 1-1..." just keep using 8606. And interestingly I've now found the first situation where my software actually uses form 8606! Here's an example I used: -- $4000 IRA contribution of which $500 was made after Jan 1 for the previous year -- $200 sitting in the IRA which was previous...

FiveK wrote: ↑Sun Mar 19, 2023 12:50 pm Yes, at the very least if you can use a non-zero value based on the letter of the Form 8606 Line 2 instructions.

See Example 1b in the backdoor Roth wiki for more.

The wiki for "example 1b" points to a thread to which I just posted. The summary is that I'm of the opinion one can retain a basis in an IRA even if the IRA balance is zero.

While there is no clear guidance from the IRS with respect to temporary -0- balances in an IRA, the instructions for Form 8606 (page 6) specifically indicate that the line 14 figure from the most recent 8606 is to be entered on line 2 of the current 8606. Therefore, preserving a line 14 entry is key to preserving any prior unrecovered basis. Circling back to this thread from a long time ago because it was referenced in a recent post. My position is that one can preserve a basis on line 14 simply by choosing to use the Pub 590-B 1-1 worksheet. There are multiple parallel paths with respect to the 8606 instructions, and the instructions in Pub 590-B (and Pub 17) can supersede those found on the 8606 instructions. So my (lay) position is that...

My understanding is that if you miss the deadline, go ahead and make the payment ASAP. IANAL https://www.keepertax.com/posts/what-happens-if-you-miss-a-quarterly-estimated-tax-payment Once a due date has passed, the IRS will typically dock 0.5% of the entire amount you owe. For each partial or full month you don’t pay the tax in full, the penalty increases. It's capped at 25%. The quote above is wrong. The 0.5% penalty per month (or partial month) up to a maximum of 25% applies to the penalty for late payment of tax. That is a different penalty and different calculation from the penalty for underpayment of estimated tax, which is essentially an interest calculation based on current interest rates. For the author, who is an Enrolled Agent a...

LookinAround wrote: ↑Fri Mar 17, 2023 3:19 pm

stan1 wrote: ↑Sun Mar 12, 2023 8:19 pm I use desktop versions of tax software and enter all data from the PDFs I download myself rather than having the tax software download it.

The desktop software is purchased in advance. You can make as many changes as you want before you file.

Why do you fill it in yourself vs having the software download it? just curious....

I 've stopped importing forms. I've seen so many errors. The time I spend ensuring the download is accurate is more than the time I spend to hand-enter forms. By the time I go through the steps to "import" the form I've already typed all that info in.

Any recommendations on software? Any that will allow you to see the final return before paying? Are you cost conscious? The desktop version of TaxAct is what I've been using for 13+ years. I've trialed HRB, TT, and many other "pro" versions and never switched. Is taxact perfect? Of course not. But I think it works best for those who are "tax savvy" and know what their return needs to look like. Their forms mode (in my opinion) is the quite good compared to many others and saves a ton of time vs going through an interview or similar walkthrough. This is HIGHLY subjective of course. That said, I'm currently infuriated with taxact because it's forcing me to declare that a person who has an abode in NY but spent less than 1...

What are the benefits of an MBR even if we are only allowed to do in plan conversions instead of the option of in service distributions? My plan is to roll that money to a Roth IRA once I leave the company (although I think - plz confirm) that I would be taxed on the earnings once I did that. Others may have addressed this, but for the purposes of "mega" backdoor Roth the "in-service distribution" element is essentially identical as an "in-service" conversion. It's the "in-service" part that's the beneficial part. Whether the Roth money ends up in an IRA (i.e. outside of the plan) or stays in a Roth account within the plan is relatively incidental/meaningless from a financial standpoint. Once the aft...

Not seeing what you're referring to. In Pub 17 I see this: Both contributions for 2022 and distributions in 2022. If all three of the following apply, any IRA distributions you received in 2022 may be partly tax free and partly taxable. • You received distributions in 2022 from one or more traditional IRAs. • You made contributions to a traditional IRA for 2022. • Some of those contributions may be nondeductible contributions. If this is your situation, you must figure the taxable part of the traditional IRA distribution before you can figure your modified AGI. To do this, you can use Worksheet 1-1 in Pub. 590-B But reading that I would assume I did not receive any IRA distributions if all I did was a BD Roth. On Form 8606 I don't see anyt...

But there was no Part II filled out to specifically report the amount of the Roth conversion. I am pretty sure this is an error of the preparer not clicking the right box of "what happened with the money" I suspect you are correct about the person not telling the preparer about the conversion. But then yes, code 2 gives a clue but did not prompt a question from the preparer. Code 2 is required when the 1099-R reports a conversion distribution, but also applies to other situations. I just assumed I wouldn't see this "mistake" quite so often. But if it's on the taxpayer...then again, I have of course seen paid preparer errors when the taxpayer clearly communicated what they did to the prepare in very precise language. :oo...

Interestingly and semi-related, today I saw my 3rd set of professionally prepared taxes this year reporting the backdoor process, where the contribution was reported on lines 1 and 3 of part I of the 8606, and the distribution reported on line 13 (via worksheet 1-1). But there was no Part II filled out to specifically report the amount of the Roth conversion. So while 8606 indicates a non-taxable distribution of IRA funds, there is no way to tell that the distribution was a Roth conversion vs money ending up in a checking account. And I'm not sure whether that's a preparer error, software error, or perhaps another allowable "parallel path" for reporting Roth conversions (similar to the two acceptable ways to fill out Part I of 860...

Did they just "fix it" because it was a mistake? Or did they actually re-characterize it? That will determine how you document this on your taxes. Was the contribution for 2022 or 2023? It was supposed to be a 2023 contribution. They said I had to recharacterized it. I was wondering once I recharacterize it can I actually just Roth convert it. I did the same thing early in 2022 by mistake. Contributed to the Roth just out of carelessness. First, I recharacterized it. This basically completely "undos" the Roth contribution and makes it AS IF it was contributed to the Traditional IRA in the first place. Then I immediately converted it to a Roth. Summary: YES you can convert recharacterized amounts in the identical way you...

White Coat Investor wrote: ↑Sat Mar 11, 2023 6:40 pmBut it does mention in multiple places that a conversion isn't a distribution.

Ah, now I understand why you are confused by the previous discussion and my references to the instructions on Pub 17, 8606, etc.

A Roth conversion is absolutely, 100% an IRA distribution and all the IRS publications and instructions (including form 8606) are concordant on this point.

With that fact established you'll see that the instructions in Pub 17 indeed direct you to use worksheet 1-1, and supersede the instructions on form 8606.

That' seriously to say that Roth conversions don't count on the form and in the instructions but then bury the fact that they do somewhere else in the instructions. I can't even figure out where it does that. It's the secret menu at In-N-Out; it's the secret 8606 instructions. All instructions start with Publication 17 "Your Federal Income Tax". If you read linearly, you are directed to: Both contributions for 2022 and distributions in 2022. If all three of the following apply , any IRA distributions you received in 2022 may be partly tax free and partly taxable. • You received distributions in 2022 from one or more traditional IRAs. • You made contributions to a traditional IRA for 2022. • Some of those contributions may be nond...

What do you mean the preamble? The instructions for line 7 in the instructions read: Line 7 If you received a distribution in 2022 from a traditional, SEP, or SIMPLE IRA, and you also made contributions for 2022 to a traditional IRA that may not be fully deductible because of the income limits, you must make a special computation before completing the rest of this form. For details, including how to complete Form 8606, see Are Distributions Taxable? in chapter 1 of Pub. 590-B. Don’t include any of the following on line 7. • Distributions that you converted to a Roth IRA. Seems pretty clear to me By "preamble" I mean that the instructions for line 7 refer to a computation that spans more than one line. It introduces a portion of t...

Yea but you're ignoring the two lines before that "If you received a distribution". So it's not about just making a partially deductible contribution, it's about making a partially deductible contribution AND taking a distribution. That's much more rare for people doing Backdoor Roth IRAs . But you're right that the software seems to default to that worksheet. I'm confused. I don't think I'm ignoring anything? A backdoor Roth REQUIRES a distribution. It's by definition part of the process. A conversion from a non-Roth IRA to a Roth IRA (conversion) by definition is a distribution. Look at the title of form 1099-R. A Trad. IRA distribution for the purposes of Line 7 of Form 8606 excludes Roth conversions which is what the second s...

Interestingly, while I was in the 8606 instructions I noticed two penalties I hadn't seen before, $50 for failing to file 8606 and $100 for overstating your non deductible contribution. Not very big, but I don't recall ever seeing them before, I wonder if they're new. It also says you have to keep your records until all distributions are made (i.e. 30-60 years in the future). So much for only having to keep tax returns for 7 years. 1) The penalty has always been there but in 20 years of doing taxes I've never seen anyone charged the penalty. 2) The 7 year rule only applies to certain situations. You have to keep records indefinitely in a LOT of situations. What if one makes a non-deductible contribution today and thus has basis in their IR...

Yea but you're ignoring the two lines before that "If you received a distribution". So it's not about just making a partially deductible contribution, it's about making a partially deductible contribution AND taking a distribution. That's much more rare for people doing Backdoor Roth IRAs . But you're right that the software seems to default to that worksheet. I'm confused. I don't think I'm ignoring anything? A backdoor Roth REQUIRES a distribution. It's by definition part of the process. A conversion from a non-Roth IRA to a Roth IRA (conversion) by definition is a distribution. Look at the title of form 1099-R. Edit to add: the point is that any particular taxpayer doing a backdoor Roth MAY have a partially deductible contribu...

I see that instruction in 590-B, but I don't see it in the 8606 instructions. Can you point out where that is? The main reference I saw to 590-B is in the instructions for Line 7, but that only says: If you received a distribution in 2022 from a traditional, SEP, or SIMPLE IRA, and you also made contributions for 2022 to a traditional IRA that may not be fully deductible because of the income limits, you must make a special computation before completing the rest of this form. For details, including how to complete Form 8606, see Are Distributions Taxable? in chapter 1 of Pub. 590-B. and doesn't say anything about partially deductible contributions . I read "may not be fully deductible" as you quoted for line 7 as meaning "pa...

White Coat Investor wrote: ↑Thu Mar 09, 2023 5:39 pm I see that instruction in 590-B, but I don't see it in the 8606 instructions. Can you point out where that is?

Of course! See the instructions for line 7:

If you received a distribution [Neurosphere note: includes conversions] in 2022 from a traditional, SEP, or SIMPLE IRA, and you also made contributions for 2022 to a traditional IRA that may not be fully deductible because of the income limits, you must make a special computation before completing the rest of this form. For details, including how to complete Form 8606, see Are Distributions Taxable? in chapter 1 of Pub. 590-B.

Edit. So sorry, I just simply repeated what you had already posted!! Give me a minute.

Also keep in mind that there are two ways to fill out Form 8606. One just works down the form, the other uses a worksheet found somewhere in an IRS instruction. I tend to just do the first but many have noticed that Turbotax actually does the latter. Which one is more correct is controversial, but since they give the same result nobody cares. It's not all that controversial exactly, but simply that the second method (using worksheet 1-1 in publication 590-B) covers ALL situations, whereas the instructions on from 8606 only apply to a subset of situations. Essentially, if one is in the phaseout range for deducting contributions, you need to use worksheet 1-1. But one has to USE that worksheet in the first place to find if they may be in the...

Also keep in mind that not all salary gets taxed. HSA contributions, medical insurance premiums, (is there anything else?) don't count for either SS or Medicare. That is "box 5" on the W2 may be less than what you were actually paid. Thank you, neurosphere. So in essence none of the pre-tax money gets taxed for SS and medicare. Is that a fair understanding? NO. Only certain types of pre-tax income is free from one or both of SS/Medicare, often referred to collectively as "FICA" . For example, pre-tax retirement account contributions decrease taxable wages (box 1) but not box 3 and 5. Also "sscritic" (an expert on many things and who communicates with a few users via email) suggested you/others look at Publicat...

Also keep in mind that not all salary gets taxed. HSA contributions, medical insurance premiums, (is there anything else?) don't count for either SS or Medicare. That is "box 5" on the W2 may be less than what you were actually paid.

Thank you all for responding. To answer some of your questions: 1. Yes, I have had business income and also deductions every year including solo 401k contributions and expenses. So there is always a difference between the gross income and the net income. 2. For year 2021 there are 3 columns on the SSA statement Column 1 = Work year - 2021 Columns 2 = Earnings Taxed for Social Security - $142,000 Column 3 = Earnings Taxed for Medicare - $296,625 W2 reported income = $230,076 Sch C - Gross = $54,235 Net = $43908 $142,000 was the maximum amount of wages that were subject to SS tax for 2021. So that's fine. For medicare, look at Box 5 to see your earnings subject to Medicare from regular employment. For self-employment go to schedule SE and lo...

Bumping this thread because I continue to be disappointed by all NY state muni bond funds that are not vanguard. why hasn’t fidelity created a fund to compete on expense ratio? Or iShares? Or any other provider? Are state-specific muni funds so cost-intensive to run that even fidelity won’t compete better? I see vanguards VNYUX at 3.64% yield, 0.09% expense ratio Fidelity’s FTFMX at 3.34% yield, 0.46% expense ratio, AND it extends duration to close the gap iShares NYF at 3.09% yield, 0.25% expense ratio If vanguards muni rate for NY exceeds my mortgage rate, I’m going to break my one-stop shop rule with fidelity and start building the position at vanguard You can continue wondering... Or you can just open a Vanguard account. Why fight the ...

... What i see are numbers like $130,000, $120,000 etc. For what year(s) ? Were those numbers the maximum amount subject to SS for those years? https://www.ssa.gov/OACT/COLA/cbb.html Thanks. I just started looking closely and it goes back from 2021 to 2013 which is when I started my 1099 job. The numbers I am referring to are under the 3rd column "Earnings Taxed for Medicare (began 1966) on my social security statement. 1st column captures the years and the 2nd column captures Earnings Taxed for Social Security. which I understand has a maximum. Help us to help you answer your question. Can provide numbers for one particular year in which you think there is error? For example: 2020. W2 reported income as per your W2 = $X. Schedule C p...

If you report 1099 income on schedule C, the profits get reported to SS after you file your taxes with the IRS.

For what tax years is your schedule C profits missing? Did you file tax returns for those years? Do you know if your returns for those years were accepted/received by the IRS?

As far as I can tell it's just listed among all the other mutual fund options, so I assume it's not a brokerage option. Interestingly, the TIAA MMF is paying slightly more than Vanguard's , but based on the history (e.g. YTD return) it seems it lags slightly. Regarding the bolded part, caveat emptor. TIAA displays stale (sometimes month old) data when looking up yields and returns of 3rd party funds available in your plan. Thanks for the warning. For TCIXX it shows a current and effective yield of 4.52%/4.62% "as of" March 6. But for the Vanguard Federal it shows 4.52%/4.52% "as of 02/28". I think today's SEC yield for the Fed money market is actually 4.51%. But I'll bet there are obvious differences when rates are chan...

In the account where we *could* move the money, with the liquid Trad Ann, we could have selected the Vanguard MM fund, but in *that* account, there would be a transaction fee (even though in the other account, there would not be). Thanks for this warning. I have the VG MMF and the TIAA version with very similar rates. But I did not know there might be a fee. I don't see anything obvious online with respect to transaction fees. And I did a small test move and it did not warn me about any fees. Is it possible there is not a transaction fee in this case, or any guidance on where to look? Is the VG MMF in your "core" section, or in a brokerage option. My understanding (and our current experience) is that in the core area, no transact...

ResearchMed wrote: ↑Mon Mar 06, 2023 6:53 pm In the account where we *could* move the money, with the liquid Trad Ann, we could have selected the Vanguard MM fund, but in *that* account, there would be a transaction fee (even though in the other account, there would not be).

Thanks for this warning. I have the VG MMF and the TIAA version with very similar rates. But I did not know there might be a fee. I don't see anything obvious online with respect to transaction fees. And I did a small test move and it did not warn me about any fees. Is it possible there is not a transaction fee in this case, or any guidance on where to look?

In case this helps, many different pro tax software packages will NOT include a 8606 at all for a conversion that is fully taxable. I'd leave it alone. Thanks. TurboTax didn't generate a 8606 for my return. I'll take your advice. Now THAT’S interesting. If at least one large tax software program doesn’t generate an 8606 for a fully taxable Roth conversion, it sounds like the IRS doesn’t care whether the Form is filed or not. Unless it’s just a software error…. I think this would either be software error or user error. Consider the following scenario: A taxpayer under age 59.5 takes a traditional IRA distribution and within 60 days does a rollover/conversion to a Roth IRA. The conversion is fully taxable. The Form 1099-R will show distribut...

student wrote: ↑Mon Mar 06, 2023 7:36 am

McQ wrote: ↑Sun Mar 05, 2023 4:36 pm Even in my SRA, where I don’t have any contributions before 2009, the two oldest vintages (through 2019) now have rates of 4.05% and 3.80%, respectively, relative to a this-month rate of 5.25%. Not enough of a gap to motivate a complex series of changes, IMO.

Even if the rate drops from 5.25% to 5.05% when you move the money back to it, it is still at least a 1% difference. It is not that complicated to make the move. 5 minutes now and 5 minutes in 120 days.

Edit: Corrected a typo.

I've convinced myself to do this with at least a portion of my 3.25% money (it's 99% at 3.25% so proration doesn't affect me). I'll report back in 120 (plus a buffer) days!

My question is, what if I had basis years ago and no longer have basis? Does this mean I have to file 8606 every year? I think NO. I think YES. And the HRB tax software agrees with me. My non-taxable basis disappeared years ago, I've been doing Roth conversions every year since and HRB dutifully adds an 8606 to my tax filing every year. If you aren't doing Roth conversions then an 8606 isn't due each year. Some software includes the 8606 in that situation, others don't (regardless of previous basis). For example, when doing backdoor Roths, software packages fill out 8606 as per the instructions in 590-B. And almost all elect to use worksheet 1-1 even though it clearly does not apply. Worksheet 1-1 covers a situation that does not apply to ...

I looked at my notes for a vicarious replay April 2016 – filed 1040 with Turbotax (completed 2 backdoor Roths (dw and me))- did not include 8606 June 2018 IRS letter for $4200+ interest in delinquent taxes - Sent IRS all my tax documents Aug 2018 2nd IRS letter for delinquent taxes – called but not helpful – resent tax documents again Oct 2018 3rd IRS letter – pay $4200, no interest or petition in tax US Tax Court, DC within 90 days Nov 2018 Accountant sent letter including missing 8606 Feb 2019 – resolved with IRS $0 due Thanks, but this is not the situation we are describing, which is what I suspected when you mentioned the IRS had assessed extra tax. A backdoor Roth starts with a non-deductible contribution, and there is no dispute that...

It seems to me the IRS is not including conversions in their use of the term distribution in that statement, because everywhere else it's very clear that every Roth conversion needs to be reported on 8606. But yet the IRS is consistent everywhere else that when money moves out of an IRA, to any location essentially, it is indeed a distribution. Look at the instructions for Form 1099-R which makes it quite clear that a distribution which ends up in a Roth is still a distribution. I think it's reasonable to say that the instructions across all forms are somewhat ambiguous or contradictory, but that including Roth conversions on 8606 is certainly not wrong, may be prudent, but is (possibly?) not required if there isn't (or has never been) any...

I think it's more important that fully taxable Roth conversions be reported on Form 8606 for taxpayers under 59.5, even though required for all conversions. Conversions are exempt from the 10% early penalty, but if the conversion is not reported on the tax return, the IRS may conclude that the penalty applies or at a minimum require an explanation and documentation, regardless of whether the 1099-R is coded 1 or 2. I don't disagree, but... :wink: I guess the question is, where is the IRS going to look if one has an early Roth IRA withdrawal? Previously filed 8606 forms (when the instructions explicitly say NOT to file if there have never been non-deductible amounts)? Or 5498s and 1099-Rs? I agree with you that it's trivial (for those in th...

Hi All, It has been over a month since I sent in my tax return. When I check the status, I get this message, "We apologize, but your return processing has been delayed beyond the normal timeframe." I am due a sizable refund. I did e-file. Any Ideas what this could mean? Additional information request coming, audit? I did realize that I forgot to file an 858K rollover from my 401K to my individual IRA after my retirement an the end of 2021, but of course this was a non taxable event. I figured I would wait until they had processed my return and then file and amended return with this rollover. Have you created an Account on the irs.gov website and see if anything shows there? You can request an account and/or tax year transcript on...

This thread has spooked me into going back reviewing that Turbo Tax created an 8606 form for the years I did a conversion, it did ... whew :) But there was no 8606 for the year of my 401k rollover, which had after-tax amount directed into a Roth... There shouldn't have been one, right? :confused Correct, no 8606. BUT those amounts need to be tracked in case of an early distribution to report taxable amounts on form 5329. TaxAct has a worksheet for that form, that tracks (from 1998 onwards) the year and amount of any taxable amount of an rollovers from an employer plan to a Roth IRA, the basis from such rollovers, and also the taxable amount and basis of Roth IRA conversions, and finally all previous "direct" Roth contributions. I...

—- If, and only if, the IRS questions my 2022 return, I’ll file a 1040X and 8606 for 2022. Sound good? Sounds good to me with one small addition. There are many situations where things like this can be resolved with the IRS without an amendment. In response to an inquiry you can respond with an explanation and ask (or they will tell you) whether you should file an amendment, They may simply adjust things on their end without requiring an "official" new return. Edit: The 8606 can be sent in alone and acts like the amendment if it does not affect the return. It has its own signature line at the bottom of the page, and its own address line at the top. There are some mixed opinions but hundreds on BH have sent in that form on its own...

Come on everyone, read the instructions! :wink: If you received distributions from a traditional, SEP, or SIMPLE IRA in 2022 and you have never made nondeductible contributions (including nontaxable amounts you rolled over from a qualified retirement plan) to these IRAs, don’t report the distributions on 2022 Form 8606 :D My question is, what if I had basis years ago and no longer have basis? Does this mean I have to file 8606 every year? I think NO. I feel the quoted instructions above assume that once one has basis they (are very likely to) always have basis. Obviously that's not always the case. But I personally would have no problem NOT filing an 8606 for any year that IRA basis is zero. If the IRS ever asks, it's a trivial response (th...

In case this helps, many different pro tax software packages will NOT include a 8606 at all for a conversion that is fully taxable. I'd leave it alone.

Help me confirm. In January 2020 I made a contribution to the GSRA Traditional and have been earning 3% since that time. Based on the new rates as shown for the GRSA below, does this mean that I will now earn 3.25%? It seems I might be a good candidate for moving out for 6 months and moving back in. Worst case scenario is I go back to 3% (the minimum for GSRA), right? In the meantime I could likely earn more in an MMF. Oh, but then I lose future credits towards annuitization. Hmm. So confusing. I'm a good candidate for annuitizing. Predicting the future is harder than it used to me. :wink: Contributions Applied Interest Rate 01/01/06 - 12/31/11 4.05% 01/01/12 - 12/31/19 3.80% 01/01/20 - 12/31/21 3.25% <---- 01/01/22 - 04/30/22 3.85% 05/01/...

Help me confirm. In January 2020 I made a contribution to the GSRA Traditional and have been earning 3% since that time. Based on the new rates as shown for the GRSA below, does this mean that I will now earn 3.25%? It seems I might be a good candidate for moving out for 6 months and moving back in. Worst case scenario is I go back to 3% (the minimum for GSRA), right? In the meantime I could likely earn more in an MMF. Oh, but then I lose future credits towards annuitization. Hmm. So confusing. I'm a good candidate for annuitizing. Predicting the future is harder than it used to me. :wink: Contributions Applied Interest Rate 01/01/06 - 12/31/11 4.05% 01/01/12 - 12/31/19 3.80% 01/01/20 - 12/31/21 3.25% <---- 01/01/22 - 04/30/22 3.85% 05/01/2...

student wrote: ↑Tue Feb 28, 2023 5:25 pm The new rates are out. SRA: Feb bucket and March bucket get 5.25%, January rate stayed the same, all other buckets got an increase. RA: Across the board raises.

That would be welcome news for me! If indeed that means that funds which are currently paying me 3% will start paying me more?

I have not added new money in over a year. In my RC account the additional amounts are being added into the original vintages even though there are several newer vintages with higher rates. But in my GSRA the additional amounts get added into new vintages This sounds wrong. Could you please check your calculations, allowing for different Vintage dates and different Guaranteed interest rates? Also check if your RC or RCP Guaranteed interest rate has changed. It sounds right to me, and matches my experience...as long as one doesn't interpret the "even though there are several newer vintages" to mean such vintages had/have non-zero balances i n his RC account . Yes, ofckrupke has correctly interpreted my imprecise wording. The last ...

TaxAct does the same, btw.

Any btw, over time the rounding errors would be expected to even out, statistically. No? Next year it may be $10 in your favor. Or another $6 against you.

Have you added any *new* money into those buckets? Does the overflow stay in the current bucket as described above? The buckets don't seem to appear unless/until there is new money added, because the "overflow" (in these types of IRA/etc., accounts) does *not* go into the new bucket, even if there are new, higher rate buckets. That's because without *new* money, there's nothing going into those new buckets. However, I don't know whether "RC" Trad Ann works this way. We don't have that type of account. I have not added new money in over a year. In my RC account the additional amounts are being added into the original vintages even though there are several newer vintages with higher rates. But in my GSRA the additional am...

The "problem" is mostly an unfortunate formatting issue, I *think*. That is, if the rate has not changed, at least in Trad Ann in our IRA type accounts, then the "new interest" is added into the "current" bucket, which, of course (!?) is *NOT* labelled to be "current". That seems to change only if the rate changes, in which case a new bucket is added. I think at that time, the "end date" of the previously newest bucket (hope that gobbledy gook is clear?) changes to whenever that rate ended. I understand what you are saying in that TIAA only updates the "end of the bucket" period when there is a rate change and adds a new "line" to the statement. But for my RC contract th...

The image I posted in my previous post is from an employer 403b. It's an account which received the employer contributions and has the label "RC". Do all "RC" accounts behave like this (perhaps similar to IRAs as you point out)? Where can I read about this?