Search found 2575 matches

by Chip
Wed Sep 11, 2019 3:01 pm
Forum: Personal Finance (Not Investing)
Topic: Roth or Traditional based on tax bracket
Replies: 49
Views: 2653

Re: Roth or Traditional based on tax bracket

My thought process is that if I can currently afford to pay 24% tax, and it doesn't impact my ability to contribute to the maximum allowed in tax advantaged retirement accounts, I'd rather pay the tax now and not have to worry about it in the future. Then I will be able to convert my traditional ba...
by Chip
Wed Sep 11, 2019 1:11 pm
Forum: Personal Finance (Not Investing)
Topic: Overpaying Medicare Part B when first collecting Soc Sec
Replies: 10
Views: 1123

Re: Overpaying Medicare Part B when first collecting Soc Sec

My wife's experience in 2017:

Timeline

4/25: 3 month (May-July) Medicare Part B premium due; paid by check
5/15: First SS benefit deposit; May Medicare Part B premium deducted from payment
6/08: Refund of 3 month premium paid in April received by mail.
by Chip
Wed Sep 11, 2019 1:05 pm
Forum: Personal Finance (Not Investing)
Topic: Roth or Traditional based on tax bracket
Replies: 49
Views: 2653

Re: Roth or Traditional based on tax bracket

Yes, this is another factor to consider for you traditionalists. Currently you are married and in a married bracket. You probably plan to be in a married bracket in retirement and doing conversions. But one spouse can die earlier than expected, meaning you lost out on paying a lower tax rate while ...
by Chip
Wed Sep 11, 2019 12:53 pm
Forum: Personal Investments
Topic: Portfolio Review request
Replies: 9
Views: 1378

Re: Portfolio Review request

Any opinions on the 401k offerings in our plans? As mentioned earlier, low expenses are key. You have a few good choices in your plan, while your wife has many. So build your portfolio by picking the lowest cost options in your plan, then fill out the rest of your portfolio allocation with choices ...
by Chip
Wed Sep 11, 2019 6:51 am
Forum: Personal Finance (Not Investing)
Topic: BofA ShopSafe going away
Replies: 111
Views: 7892

Re: BofA ShopSafe going away

Chase was really helpful in that they were able to leave the card open for all charges in the location I was in as long as the card was physically present. They set the card to shut down the day after I returned from the trip and then mailed me a replacement card. I don’t know that other banks woul...
by Chip
Wed Sep 11, 2019 4:58 am
Forum: Personal Finance (Not Investing)
Topic: BofA ShopSafe going away
Replies: 111
Views: 7892

Re: BofA ShopSafe going away

I don't understand all the handwringing over services like ShopSafe. After all, if the card is compromised the bank (CC company) is going to fully indemnify you for any losses. Because I have zero risk, I would not want to (don't) add any additional steps to an online (or store) purchase transactio...
by Chip
Tue Sep 10, 2019 3:39 pm
Forum: Personal Finance (Not Investing)
Topic: Roth or Traditional based on tax bracket
Replies: 49
Views: 2653

Re: Roth or Traditional based on tax bracket

I was saying that many people say to do traditional 401k, and you can convert it to Roth later. I'm saying in that scenario, your traditional balance will be that high when it's time to start converting. If you do all Roth 401k, then the traditional balance will be lower (only matches) and be more ...
by Chip
Tue Sep 10, 2019 3:19 pm
Forum: Personal Investments
Topic: Giving stock shares to daughters, stock not traded.
Replies: 24
Views: 1304

Re: Giving stock shares to daughters, stock not traded.

Chip, are you saying in the case of a gifted stock that shows a capital loss, neither the donor nor the recipient can claim the loss? Yes, unless the donee sells the stock for less than the FMV at the date of the gift. And then it's only the difference between that much lower number and the sale pr...
by Chip
Tue Sep 10, 2019 1:52 pm
Forum: Personal Investments
Topic: Giving stock shares to daughters, stock not traded.
Replies: 24
Views: 1304

Re: Giving stock shares to daughters, stock not traded.

For a gift, basis follows the stock. Your basis ($68,000) will be her basis, and if she sells at a loss, she gets the claim the loss on her taxes. You would not get the tax loss benefit by giving her the stock. This isn't correct in the case where the FMV of the gift is less than the donor's basis....
by Chip
Mon Sep 09, 2019 2:46 pm
Forum: Personal Finance (Not Investing)
Topic: Roth or Traditional based on tax bracket
Replies: 49
Views: 2653

Re: Roth or Traditional based on tax bracket

Interesting point on the Roth conversions at early retirement. I believe the only problem with that is that upon conversion, I would have to wait 5 years before we can draw principle, correct? I guess the taxable account will have to cover us for those 5 years. Yes, each conversion has its own five...
by Chip
Mon Sep 09, 2019 12:00 pm
Forum: Personal Finance (Not Investing)
Topic: Roth or Traditional based on tax bracket
Replies: 49
Views: 2653

Re: Roth or Traditional based on tax bracket

It sounds like you've thought this through pretty well. I would be inclined to go 100% traditional since it appears that you are saving at a pretty aggressive rate (I'm extrapolating from 24% bracket and 75k expenses). I'm guessing you'll retire early, with time to do Roth conversions then at low ra...
by Chip
Mon Sep 09, 2019 6:27 am
Forum: Investing - Theory, News & General
Topic: The case for considering overall career marginal tax when deciding between trad and Roth.
Replies: 25
Views: 2046

Re: The case for considering overall career marginal tax when deciding between trad and Roth.

But for people that are still working and saving, I'd argue that the superior strategy is to do Traditional as much as you can now and plan far ahead for how you're going to withdraw it tax free. I agree that for most, traditional contributions while working often make the most sense. But I really ...
by Chip
Sun Sep 08, 2019 9:22 am
Forum: Investing - Theory, News & General
Topic: The case for considering overall career marginal tax when deciding between trad and Roth.
Replies: 25
Views: 2046

Re: The case for considering overall career marginal tax when deciding between trad and Roth.

I don't know...to get into that situation just seems like the result of poor planning to me. So you're suggesting that it's poor planning to take a job with a pension? Poor planning to max out a 401k deductions vs. paying high taxes while working to create a large taxable account? Poor planning to ...
by Chip
Sun Sep 08, 2019 6:43 am
Forum: Investing - Theory, News & General
Topic: The case for considering overall career marginal tax when deciding between trad and Roth.
Replies: 25
Views: 2046

Re: The case for considering overall career marginal tax when deciding between trad and Roth.

Sorry, I never meant to you imply could withdraw >$100,000 TIRA per year tax free. Like the quote says, that refers to $80k in taxable withdrawals and $27k in TIRA withdrawals tax free. Which is pretty much enough to cover 99% of people in retirement. I've heard that 97% of statistics are made up o...
by Chip
Sat Sep 07, 2019 1:11 pm
Forum: Personal Investments
Topic: Placing bid on brokered cd?
Replies: 14
Views: 1320

Re: Placing bid on brokered cd?

This wasn't about CDs, but I did have a discussion about buying TIPS on the secondary market with bond desk at Fidelity. It's been several years ago, but I came away with the understanding that the TIPS order at a limit price would for all intents and purposes be fill or kill. The discussion gave me...
by Chip
Sat Sep 07, 2019 5:41 am
Forum: Personal Investments
Topic: writing off stock loss to off set tax when withdrawing money from 401k.
Replies: 10
Views: 839

Re: writing off stock loss to off set tax when withdrawing money from 401k.

It is a "use it or lose it" deduction. Even if a tax return is not required, the loss carry-forward is reduced by $3,000 per year. I agree with ivk5, this isn't quite correct. If taxable income is low enough (essentially zero without the loss), the capital loss isn't "used" in that year. See the ca...
by Chip
Thu Sep 05, 2019 2:51 pm
Forum: Personal Finance (Not Investing)
Topic: BofA ShopSafe going away
Replies: 111
Views: 7892

Re: BofA ShopSafe going away

...we’re always looking for ways to improve your digital banking experience. On September 20, we are discontinuing our online ShopSafe® service. You gotta love the way they word these service reductions. I wonder if there was backslapping and high-fiving in the conference room where they thought th...
by Chip
Thu Sep 05, 2019 2:46 pm
Forum: Personal Finance (Not Investing)
Topic: Kitces: The Problem with FIREing at 4% and the Need for Flexible Spending Rules
Replies: 274
Views: 20877

Re: Kitces: The Problem with FIREing at 4% and the Need for Flexible Spending Rules

trueblueky wrote:
Thu Sep 05, 2019 2:37 pm
For those retiring early, start by withdrawing 3.5% annually.
When you get to 30 years from expiration date, raise that to 4%.
Done!
If I had done that (and not ratcheted) my current "allowable" spend would be 44% lower than it is with ratcheting. I guess heirs would be happy about that. :D
by Chip
Thu Sep 05, 2019 12:44 pm
Forum: Personal Finance (Not Investing)
Topic: Kitces: The Problem with FIREing at 4% and the Need for Flexible Spending Rules
Replies: 274
Views: 20877

Re: Kitces: The Problem with FIREing at 4% and the Need for Flexible Spending Rules

The second strategy he discusses is to withdraw every year the greater of 3.5% the portfolio's current balance or last year's withdrawal plus the inflation adjustment (i.e. 'resetting' the withdrawals). This seems much better than the ratcheting rule to me, although as Kitces notes, the decreasing ...
by Chip
Mon Sep 02, 2019 3:52 pm
Forum: Personal Finance (Not Investing)
Topic: Life Expectancy For Those Born in 1960
Replies: 26
Views: 2320

Re: Life Expectancy For Those Born in 1960

Kitces has a downloadable Excel spreadsheet that I found useful. While it calculates joint life expectancies it also does single.

https://www.kitces.com/joint-life-expec ... alculator/
by Chip
Mon Sep 02, 2019 3:46 pm
Forum: Investing - Theory, News & General
Topic: Best of Bogleheads - your #1 takeaway
Replies: 151
Views: 15303

Re: Best of Bogleheads - your #1 takeaway

There have been several things here which turned on a light bulb for me. 1. From Rick Ferri, sometime after the bottom of the 2009 market: Paraphrasing: "If you didn't rebalance into stocks according to your IPS, all through the market meltdown, then you had too high an allocation to equities." Then...
by Chip
Mon Sep 02, 2019 9:07 am
Forum: Personal Consumer Issues
Topic: New car delivery - what to check?
Replies: 22
Views: 1651

Re: New car delivery - what to check?

In addition to other suggestions, check all normal maintenance items: oil & other fluid levels, tire pressure, etc.

Our recent new car had tires inflated to the sidewall maximum vs. the door plate spec.
by Chip
Sun Sep 01, 2019 8:44 am
Forum: Investing - Theory, News & General
Topic: Allan Roth article on munis and question
Replies: 38
Views: 2706

Re: Allan Roth article on munis and question

as an added point..... the SEC is the 30 day yield of the face of the securities held. If you buy a face value (as an example) $100 muni bond that has a face of 1.25% than the SEC is 1.25% and the distribution yield is 1.25%. If you bought that vary same bond for $50 the SEC is still 1.25% but the ...
by Chip
Fri Aug 30, 2019 4:19 am
Forum: Personal Finance (Not Investing)
Topic: Social security now or latet
Replies: 19
Views: 1734

Re: Social security now or latet

Op here. I’m 66 wife is 65 and is taking benefits now. The uncertainty I was citing regards the potential solvency issue of SS. Since you are 66 that means you were born before 1/2/54. Since your wife is already taking benefits you are eligible to file for spousal benefits only while allowing your ...
by Chip
Wed Aug 28, 2019 1:49 pm
Forum: Investing - Theory, News & General
Topic: Brokerages good for tax rates on ADRs? (Foreign withholding)
Replies: 15
Views: 494

Re: Brokerages good for tax rates on ADRs? (Foreign withholding)

If I recall correctly, per my reading of the relevant publication/instructions, you're not allowed to take an FTC to the extent that the withholding exceeds what you truly owe. So if you owe 10% but the broker withholds ~15.4%, you can only (if you're following the rules, and if I understand/recall...
by Chip
Wed Aug 28, 2019 12:53 pm
Forum: Investing - Theory, News & General
Topic: Brokerages good for tax rates on ADRs? (Foreign withholding)
Replies: 15
Views: 494

Re: Brokerages good for tax rates on ADRs? (Foreign withholding)

Are you getting a full foreign tax credit for the taxes paid? If so it really doesn't matter what you pay to the foreign country.
by Chip
Wed Aug 28, 2019 6:11 am
Forum: Personal Finance (Not Investing)
Topic: Tax Aid Volunteering for AARP or VITA
Replies: 52
Views: 2966

Re: Tax Aid Volunteering for AARP or VITA

So, I assume at AARP or VITA I don't have to worry about selling or fees, but are there any "politics" that I should know about? Any strict time requirements? Can you set your own schedule? Next year will be my 13th year at Tax Aide. There is no selling or fees to worry about. We have a few Block "...
by Chip
Sun Aug 25, 2019 7:58 am
Forum: Personal Finance (Not Investing)
Topic: Help in estimating capital gains tax on residence
Replies: 9
Views: 728

Re: Help in estimating capital gains tax on residence

Gill wrote:
Sun Aug 25, 2019 7:18 am
The deferred gain on your prior residence is irrelevant

Gill
I haven't looked it up, but since the OP purchased before the current home sale law went into effect (1997?), wouldn't prior deferrals under the old law be reflected in the cost basis of the house now being sold?
by Chip
Fri Aug 23, 2019 10:42 am
Forum: Personal Finance (Not Investing)
Topic: Roth Conversions - Estimated Taxes
Replies: 13
Views: 1587

Re: Roth Conversions - Estimated Taxes

At the risk of further muddying the waters, I think this is what Alan S. is saying you have to do to accomplish your goals. If your desired Roth conversion is $X, with $Y of "extra" taxes associated with it: 1. Convert $X to Roth. No withholding. 2. Withdraw $Y from the tIRA in a separate transactio...
by Chip
Thu Aug 22, 2019 5:54 am
Forum: Personal Investments
Topic: Keep rollover out of market 2days for access to higher rate mm fund?
Replies: 6
Views: 537

Re: Keep rollover out of market 2days for access to higher rate mm fund?

Is the the day of two extra time out of market likely to cost more than the er / return differences between sprxx or spaxx and fdzxx is worth? You can calculate this pretty easily. But you should know that in a tIRA or rIRA the minimum buy-in for FZDXX is only 10k. It is 100k for taxable accounts.
by Chip
Thu Aug 22, 2019 5:48 am
Forum: Investing - Theory, News & General
Topic: tax efficiency of funds vs ETFS - better to stay the course than chase a few bp
Replies: 4
Views: 421

Re: tax efficiency of funds vs ETFS - better to stay the course than chase a few bp

I am sure I missed something in my simplistic analysis, and I invite those more knowledgeable on the subject to chime in with their thoughts. Morningstar's tax cost numbers are notoriously inaccurate. An often quoted example is that they show different TCRs for VTSAX and VTI, which are share classe...
by Chip
Wed Aug 21, 2019 2:11 pm
Forum: Personal Finance (Not Investing)
Topic: Roth Conversions - Estimated Taxes
Replies: 13
Views: 1587

Re: Roth Conversions - Estimated Taxes

Do you have another source of income from which you could increase withholding? Perhaps Social Security, dividends from a taxable account, pension, etc.?
by Chip
Wed Aug 21, 2019 1:23 pm
Forum: Personal Consumer Issues
Topic: Replacing brake pads in a Honda CRV 125,000 miles
Replies: 34
Views: 2335

Re: Replacing brake pads in a Honda CRV 125,000 miles

Agreed. I just did a nightmare brake job on an accord that had a stuck caliper that cooked, well, everything. The brakes were previously serviced by the dealer and a lot of good that did. Those screws didn't take a lot of time I guess, but were plenty annoying. One required drilling out. It's unwis...
by Chip
Mon Aug 19, 2019 1:16 pm
Forum: Personal Consumer Issues
Topic: Buying an older used car - any new/different ideas?
Replies: 64
Views: 3487

Re: Buying an older used car - any new/different ideas?

Makes sense. Although to do the test drives, you still have to go to new car dealerships, right? Definitely. But it really hasn't been that much of a hassle. I make sure that I am upfront and firm that "I will not buy today so don't bring me an offer. But I will buy within the next two weeks. I'll ...
by Chip
Mon Aug 19, 2019 10:42 am
Forum: Personal Consumer Issues
Topic: Buying an older used car - any new/different ideas?
Replies: 64
Views: 3487

Re: Buying an older used car - any new/different ideas?

I find it much harder to understand why so many people put up with the tactics at new car dealerships. I don't put up with them. I bought our last two cars via email after settling on what we wanted after a few test drives. There was no negotiation -- I got one "best" out-the-door bid from each dea...
by Chip
Sun Aug 18, 2019 3:40 pm
Forum: Personal Consumer Issues
Topic: Ethernet, MoCA, House Wiring
Replies: 24
Views: 2117

Re: Ethernet, MoCA, House Wiring

I have a MoCA setup feeding two Tivo minis that would otherwise require wired Ethernet. It works quite well in that application but I don't suppose that tells you much about how MoCA would work in your particular situation. I haven't tried to do any speed testing. I have cable TV and internet/phone ...
by Chip
Sun Aug 18, 2019 5:28 am
Forum: Personal Consumer Issues
Topic: Aliens have captured my husband [wants to buy a Porsche]
Replies: 138
Views: 11187

Re: Aliens have captured my husband [wants to buy a Porsche]

<And then, as you said, the aliens came.> I saw a Jaguar XJ8 advertised locally. It was the most lovely shade of glittery green, almost black. Sweet leather seats nicer than my sofa (way nicer) and shiny chrome in the door frames. Birdseye maple fold-down trays in the back that made me giggle remem...
by Chip
Sun Aug 18, 2019 5:12 am
Forum: Personal Finance (Not Investing)
Topic: Yet another CP2000 for Roth IRA conversion thread
Replies: 51
Views: 7258

Re: Yet another CP2000 for Roth IRA conversion thread

The second issue reported in CP2000 is completely weird. It claimed our return had $400 in qualified dividends (QDI) but Vanguard supposedly reported $600 as QDI in 1099-Div which is completely wrong. Vanguard brokerage reported in excess of $10K as QDI and we reported the exact same amount on line...
by Chip
Sat Aug 17, 2019 10:57 am
Forum: Personal Investments
Topic: Single-stock investing in taxable or Roth?
Replies: 39
Views: 1814

Re: Single-stock investing in taxable or Roth?

I think the replies have covered nearly all the angles. Since you understand that this is generally bad idea, but your partner doesn't, I would suggest a Roth for these reasons: There will be no tax reason to delay selling if there is a gain and "the time is right". If there's a loss your partner wi...
by Chip
Mon Aug 12, 2019 10:52 am
Forum: Personal Finance (Not Investing)
Topic: Best Checking/ System for Cash Management/ Sweeping?
Replies: 19
Views: 3012

Re: Best Checking/ System for Cash Management/ Sweeping?

while aboard, have you or anyone else on this forum, successfully used the CMA abroad with $0 in the account and overdraft on? im traveling in a few months and was wondering if I need to keep some money in the CMA just to be safe and not get declined at ATMs abroad, TIA I haven't. I only have the r...
by Chip
Mon Aug 12, 2019 7:04 am
Forum: Investing - Theory, News & General
Topic: Roth > Taxable > tIRA
Replies: 200
Views: 15005

Re: Roth > Taxable > tIRA

ROTH Conversion is approximately the percent of tIRA converted to Roth. EFFECTIVE TAX RATE is the dollar amount of tax divided by the dollar amount converted, which is subtracted from Taxable account. TOTAL BALANCE is the sum of tIRA, Roth and Taxable account immediately after Roth Conversion. Disp...
by Chip
Mon Aug 12, 2019 5:06 am
Forum: Personal Finance (Not Investing)
Topic: Tax implications of Calvert settlement distribution
Replies: 9
Views: 3384

Re: Tax implications of Calvert settlement distribution

Thanks. The categories are broken down by amount; the largest is fees, followed by foregone appreciation component, and lastly interest. Would those all be capital gain except for the interest? That sounds correct to me. The idea is that whatever price you sold the fund at it would have been higher...
by Chip
Sun Aug 11, 2019 10:30 am
Forum: Investing - Theory, News & General
Topic: Roth > Taxable > tIRA
Replies: 200
Views: 15005

Re: Roth > Taxable > tIRA

I don’t think it’s the 1099s OP worries about, but the allowed tax exceptions for them (eg, medical). As I'm sure you know, no one has to take medical deductions (or any other itemized deduction) to which they're entitled. The standard deduction can always be taken. It might cost thousands in extra...
by Chip
Sun Aug 11, 2019 9:13 am
Forum: Investing - Theory, News & General
Topic: Roth > Taxable > tIRA
Replies: 200
Views: 15005

Re: Roth > Taxable > tIRA

Since you've said that 1099-Rs are okay on your tax return, and RMDs can be automated with most brokers, why are you willing to pay unnecessary taxes to get rid of them?
:shock:
by Chip
Sat Aug 10, 2019 12:55 pm
Forum: Investing - Theory, News & General
Topic: Roth > Taxable > tIRA
Replies: 200
Views: 15005

Re: Roth > Taxable > tIRA

grayfox's concerns about messing around with taxes and the IRS in our 90s are valid. Missing or withdrawing insufficient RMD would bring you potentially large penalties. It may be a valid concern but there is an entire minefield of "valid concerns" once cognitive decline sets in. I don't believe it...
by Chip
Fri Aug 09, 2019 7:49 am
Forum: Investing - Theory, News & General
Topic: Roth > Taxable > tIRA
Replies: 200
Views: 15005

Re: Roth > Taxable > tIRA

But you help your mother with her taxes, right? I did, until she died. However, she could have easily had her return completed by Tax-Aide in the building where she lived. Except that I am doing Roth conversion now, while I can still deal with the IRS, if necessary. At this time, I can still read m...
by Chip
Fri Aug 09, 2019 6:19 am
Forum: Investing - Theory, News & General
Topic: Roth > Taxable > tIRA
Replies: 200
Views: 15005

Re: Roth > Taxable > tIRA

I am going to guess that your mother is fortunate enough to have a son who is a professional CPA or CFP or similar, amiright? No, you're wrong. I have had no professional tax training. If you're concerned about having your taxes done correctly as you age I suggest getting them done for free by AARP...
by Chip
Thu Aug 08, 2019 3:27 pm
Forum: Investing - Theory, News & General
Topic: Roth > Taxable > tIRA
Replies: 200
Views: 15005

Re: Roth > Taxable > tIRA

I would have lost a lot of money betting on how long this thread would stay active. You guys are arguing with somebody who doesn’t have any interest in the zero tax bracket. He’s not interested. You’re not going to get him interested. Good point. Some are willing to give up tens of thousands of dol...
by Chip
Wed Aug 07, 2019 2:35 pm
Forum: Investing - Theory, News & General
Topic: Roth > Taxable > tIRA
Replies: 200
Views: 15005

Re: Roth > Taxable > tIRA

I’m unclear on on what money coming out of tIRA would not be taxed. Is it any medical care, or just long term nursing home expenses or just long term care insurance premiums? Is it only the amount over 10% (or 7.5% if older than 65) of AGI? So we're talking about using large medical itemized deduct...
by Chip
Wed Aug 07, 2019 12:41 pm
Forum: Investing - Theory, News & General
Topic: ETF How To [How do I purchase and use ETFs in my portfolio?]
Replies: 53
Views: 3176

Re: ETF How To [How do I purchase and use ETFs in my portfolio?]

Let me see if I can clarify my understanding now: A-For smaller orders of large, liquid securities (such as someone who is DCA'ing an amount of a couple hundred to a couple thousand at a time, into the funds over months or years) a market order is essentially fine because the bid/ask spread is bare...