Search found 8092 matches

by Alan S.
Thu Feb 21, 2019 9:16 pm
Forum: Personal Investments
Topic: Spousal Inherited IRA, Partial Rollover, Vanguard
Replies: 10
Views: 460

Re: Spousal Inherited IRA, Partial Rollover, Vanguard

Question here. I "inherited" my husband's IRA. He passed in early January of this year. Fidelity first put it in an inherited IRA, and took the RMD out for 2019. They then rolled it into my IRA. I have been required to take RMD's for my account for two years. When I make out my 2019 taxes next year...
by Alan S.
Thu Feb 21, 2019 5:15 pm
Forum: Personal Finance (Not Investing)
Topic: Mega Backdoor question - from 401(k) to Roth IRA without intermediary traditional IRA?
Replies: 15
Views: 1359

Re: Mega Backdoor question - from 401(k) to Roth IRA without intermediary traditional IRA?

I am not sure how many references she needs, but here are 4 more: 1) Direct tax code Sec 408A(d)(3)(A): (3)Rollovers from an eligible retirement plan other than a Roth IRA (A)In general Notwithstanding sections 402(c), 403(b)(8), 408(d)(3), and 457(e)(16), in the case of any distribution to which th...
by Alan S.
Thu Feb 21, 2019 3:34 pm
Forum: Personal Investments
Topic: Rolling IRAs into 401k question
Replies: 12
Views: 540

Re: Rolling IRAs into 401k question

Rather an odd request from ML for IRA statements. The way it's worded ("send a copy of the opening statement showing the original deposit") suggests they only accept uncontaminated rollover IRA funds, and that there isn't any additional contributions. Contributary IRA accounts receive several contri...
by Alan S.
Thu Feb 21, 2019 12:36 pm
Forum: Personal Finance (Not Investing)
Topic: Married Filing Separately to control IRMAA costs
Replies: 11
Views: 675

Re: Married Filing Separately to control IRMAA costs

If you are correct about the IRMAA savings, beware of several other possible negative effects on your taxes by filing MFS, including how this affects your state income tax bill. This calls for entering your complete return info 3 ways, MFJ plus IRMAA and MFS (each spouse) plus that IRMAA. In additio...
by Alan S.
Thu Feb 21, 2019 12:16 pm
Forum: Personal Investments
Topic: Mega backdoor Roth Turbotax headache
Replies: 17
Views: 1205

Re: Mega backdoor Roth Turbotax headache

Am now getting the impression there were 3 rollover transactions included on the second 1099R, the two I listed earlier PLUS a 401k to Roth IRA rollover, officially a "qualified rollover contribution". Trying to follow what you are saying, you are saying the second (largest) 1099-R includes : 1) th...
by Alan S.
Wed Feb 20, 2019 8:17 pm
Forum: Personal Investments
Topic: Mechanics of IRA Rollover w/ Tax Basis into Employer Plan
Replies: 17
Views: 1005

Re: Mechanics of IRA Rollover w/ Tax Basis into Employer Plan

To follow-up on this thread and perhaps serve anyone else using the search feature here's how it went thus far... Using the above sample data - I rolled ~$95k to the employer plan leaving ~$5k behind (with most of that being the ~$4500 basis). As suggested - I did not immediately Roth convert the r...
by Alan S.
Wed Feb 20, 2019 7:07 pm
Forum: Personal Investments
Topic: Mega backdoor Roth Turbotax headache
Replies: 17
Views: 1205

Re: Mega backdoor Roth Turbotax headache

Am now getting the impression there were 3 rollover transactions included on the second 1099R, the two I listed earlier PLUS a 401k to Roth IRA rollover, officially a "qualified rollover contribution". If so, the Box 2a and 5 instructions are the same as for the IRR, so you should still be able to g...
by Alan S.
Wed Feb 20, 2019 6:32 pm
Forum: Personal Investments
Topic: Mega backdoor Roth Turbotax headache
Replies: 17
Views: 1205

Re: Mega backdoor Roth Turbotax headache

Most likely the first 1099-R is reporting the rollover from the Roth 401(k) to the Roth IRA, which is not taxable. Box 5 is reporting your contribution basis, which is important if you decide to do an early withdrawal (since it can be withdrawn tax free, and penalty free if 5 years have passed from...
by Alan S.
Wed Feb 20, 2019 5:08 pm
Forum: Personal Investments
Topic: Spousal Inherited IRA, Partial Rollover, Vanguard
Replies: 10
Views: 460

Re: Spousal Inherited IRA, Partial Rollover, Vanguard

(paging Alan S!) I called Vanguard today and asked about transferring a portion of the spousal/beneficiary IRA I have from the late DH to an IRA of my own. (I'm 52, DH was 55 when he died, so no RMDs started or anything.) My reading at IRAHelp.com and I believe a previous answer here from Alan S. i...
by Alan S.
Wed Feb 20, 2019 3:47 pm
Forum: Personal Finance (Not Investing)
Topic: Roth to Traditional IRA Recharacterization Question?
Replies: 1
Views: 119

Re: Roth to Traditional IRA Recharacterization Question?

No. As you said, the actual amount transferred includes the gain/loss adjustment dictated by the recharacterization formula. So if your Roth contribution gained about $34 while in the Roth, then the initial value of the TIRA would have been 2514.64, after which there was another gain of 27.91. Howev...
by Alan S.
Wed Feb 20, 2019 3:15 pm
Forum: Personal Finance (Not Investing)
Topic: FreeTaxUSA forces me to deduct tIRA contribution--does it matter?
Replies: 18
Views: 1037

Re: FreeTaxUSA forces me to deduct tIRA contribution--does it matter?

This happened to me with FreeTaxUSA for the 2016 tax year. I was retired with high enough income from 1099-Rs and part-time work that I couldn't do direct $6500 contribution to Roth IRA. No retirement plan contributions, so software made my tIRA contribution deductible and subsequent Roth conversio...
by Alan S.
Wed Feb 20, 2019 2:58 pm
Forum: Personal Finance (Not Investing)
Topic: Roth IRA recharacterization
Replies: 5
Views: 249

Re: Roth IRA recharacterization

You would each have the same contribution limit because you are using the same MAGI figure. If you are slightly into the phaseout range, then your max 2018 Roth contributions may be roughly 700. For each spouse that contributed more than 700 or whatever the limit is, there is an excess contribution ...
by Alan S.
Tue Feb 19, 2019 11:49 pm
Forum: Personal Finance (Not Investing)
Topic: FreeTaxUSA forces me to deduct tIRA contribution--does it matter?
Replies: 18
Views: 1037

Re: FreeTaxUSA forces me to deduct tIRA contribution--does it matter?

If you are not getting an 8606 to report the conversion, perhaps you did not enter that the IRA box was checked on the 1099R and the program assumes a distribution from a non IRA plan. One potential downside of taking the deduction which offsets the conversion tax is that if your wife taps this conv...
by Alan S.
Tue Feb 19, 2019 11:16 pm
Forum: Personal Finance (Not Investing)
Topic: Roth Conversions from SE401(k)
Replies: 7
Views: 285

Re: Roth Conversions from SE401(k)

You can only do one 60 day rollover in a 12 month period*. So don't get into the habit of trying to rollover the withholding. * IRS wording, not mine Yes, but this distribution is from a 401k not from an IRA, so the one rollover limit does not apply. Generally, withholding from a conversion or qual...
by Alan S.
Tue Feb 19, 2019 10:55 pm
Forum: Personal Investments
Topic: Roth IRA - excess contribution
Replies: 9
Views: 574

Re: Roth IRA - excess contribution

Two more points. Since you are recharacterizing your Roth contribution to TIRA, you are then treated as having made a TIRA contribution which will be either deductible or non deductible. In your case due to participating in a 401k and at your joint income level, you cannot deduct the TIRA contributi...
by Alan S.
Tue Feb 19, 2019 10:44 pm
Forum: Personal Investments
Topic: A simple RMD question - meeting the RMD requirement
Replies: 25
Views: 1725

Re: A simple RMD question - meeting the RMD requirement

Replies are correct. In summary, there is no difference in requesting an RMD than any other distribution. The 1099R issued by the custodian looks no different than any other 1099R. The box 7 coding is the same (Distribution code 7). Reporting the RMD on Form 1040 is done in the same manner as any ot...
by Alan S.
Tue Feb 19, 2019 11:58 am
Forum: Personal Finance (Not Investing)
Topic: Experian to monitor bank accounts/utility bill history (optional)
Replies: 3
Views: 405

Re: Experian to monitor bank accounts/utility bill history (optional)

So, 100 million people who pay their CC bills late but pay their electric utility on time to stop the lights from going out MAY see a credit score improvement after letting these reporting agencies into their bank accounts. Bogleheads are not likely to fall into those 100 mill desperate to pick up a...
by Alan S.
Tue Feb 19, 2019 11:41 am
Forum: Personal Finance (Not Investing)
Topic: 403b and TSP
Replies: 6
Views: 433

Re: 403b and TSP

Thanks for the info. Appreciate it. Follow-up: We requested the refund through the investment company. They said they will also send a 1099-R. Her employer HR department is saying we don't need an amended W2, is this true? I'm seeing mixed answers online about whether the W2 needs to be amended or ...
by Alan S.
Tue Feb 19, 2019 10:46 am
Forum: Personal Finance (Not Investing)
Topic: Tax Reporting on Rollover (Roth) 401K to (Roth) IRA
Replies: 2
Views: 194

Re: Tax Reporting on Rollover (Roth) 401K to (Roth) IRA

Hello, I would very much appreciate some help from tax experts in this forum. Last year I decided to rollover old employer's 401K (traditional and Roth) to my IRA and Roth IRA at Vanguard. The instruction I gave was was pretty straightforward: - Roth 401K goes to Roth IRA at Vanguard - Trad 401K go...
by Alan S.
Mon Feb 18, 2019 11:39 pm
Forum: Personal Investments
Topic: Public Safety Defined Benefit 10% penalty
Replies: 6
Views: 559

Re: Public Safety Defined Benefit 10% penalty

Unfortunately, this is the exact opposite of the answer I received on the Ed Slott forum: Yes, you would incur the 10% penalty because your distribution amount is based on a certain average earnings amount and years of service rather than one of the 3 approved methods for SEPP payments outlined in ...
by Alan S.
Mon Feb 18, 2019 10:10 pm
Forum: Personal Investments
Topic: Help with excess Roth IRA contributions
Replies: 9
Views: 446

Re: Help with excess Roth IRA contributions

I agree that recharacterization and conversion of the entire TIRA is the best option. The taxable amount of your conversion would be 1750 based on your numbers, which is only 25% of the conversion. This would also set you up for continued back door Roth conversions annually without concern with wher...
by Alan S.
Mon Feb 18, 2019 9:52 pm
Forum: Personal Investments
Topic: Which tax codes were changed regarding Notice 2014-54?
Replies: 2
Views: 327

Re: Which tax codes were changed regarding Notice 2014-54?

Hi all, I want to move traditional 401(k) pre and after tax money to an IRA and Roth IRA (respectively). I know about Notice 2014-54 and that says it's ok to do and the IRS supposedly got the tax law changed appropriately. But I want to make sure, so I looked up the tax code regulations and found t...
by Alan S.
Mon Feb 18, 2019 8:52 pm
Forum: Personal Investments
Topic: Retire early and 403b withdrawal
Replies: 13
Views: 829

Re: Retire early and 403b withdrawal

... 26 U.S. Code § 72. Annuities; certain proceeds of endowment and life insurance contracts, (t) 10-percent additional tax on early distributions from qualified retirement plans, (2) Subsection not to apply to certain distributions Except as provided in paragraphs (3) and (4), paragraph (1) shall ...
by Alan S.
Sun Feb 17, 2019 10:55 pm
Forum: Personal Finance (Not Investing)
Topic: Help needed with NUA and tax prep
Replies: 6
Views: 296

Re: Help needed with NUA and tax prep

You are thinking about the usual statements made in NUA articles. If the shares are sold at a price higher than the share price upon distribution in the first year, the additional gain above the NUA per share is taxed as a ST cap gain. After one year, all gains above the value at distribution are al...
by Alan S.
Sun Feb 17, 2019 10:01 pm
Forum: Personal Finance (Not Investing)
Topic: Received Dividends After 401k Rollover
Replies: 6
Views: 314

Re: Received Dividends After 401k Rollover

Most plans have an automatic procedure to deal with trailing dividends. I would wait until about 2 months from the date of your original direct rollover as that should catch all such dividends, then call the plan to see if they can do the follow up direct rollover as before to drain the account. Tha...
by Alan S.
Sun Feb 17, 2019 9:53 pm
Forum: Personal Finance (Not Investing)
Topic: 2018 Backdoor Roth for TY2017 and forgot to file 8606 (I think)
Replies: 3
Views: 247

Re: 2018 Backdoor Roth for TY2017 and forgot to file 8606 (I think)

Hi, I've been scouring this wonderful forum for some time, but have not found an instance which fits my case exactly, so at the risk of redundancy, here goes. BLUF: for tax year 2017 wife and I each did a Feb 2018 RIRA rechar to TIRA, then conversion back to RIRA (Backdoor Roth); I did not file a 2...
by Alan S.
Sun Feb 17, 2019 9:39 pm
Forum: Personal Finance (Not Investing)
Topic: Excess Traditional IRA Contribution - Paging Alan S.
Replies: 2
Views: 174

Re: Excess Traditional IRA Contribution - Paging Alan S.

My wife and I are under age 59.5 and are in the following situation: 1. In April 2017 we made a contribution of $5500 to my wife's traditional IRA in anticipation of it being a deductible contribution. 2. In December of 2017 I was awarded a larger-than-usual bonus. 3. We filed our 2017 taxes in Mar...
by Alan S.
Sun Feb 17, 2019 7:23 pm
Forum: Personal Finance (Not Investing)
Topic: Help needed with NUA and tax prep
Replies: 6
Views: 296

Re: Help needed with NUA and tax prep

The 1099B is incorrect. It should report your actual proceeds with a basis of $20 per share. Try to get a corrected 1099B. You sold 100 sh @ $90.00, so your 1099B proceeds should be 9,000 and your basis 2,000. You report the sale in the LT section of Form 8949 and that produces a LT gain of 7,000. T...
by Alan S.
Sat Feb 16, 2019 11:04 pm
Forum: Personal Finance (Not Investing)
Topic: Mega Backdoor question - from 401(k) to Roth IRA without intermediary traditional IRA?
Replies: 15
Views: 1359

Re: Mega Backdoor question - from 401(k) to Roth IRA without intermediary traditional IRA?

The penalty does not apply does not apply due to the "Rollover" exception in the following list of penalty exceptions: https://www.irs.gov/retirement-plans/plan-participant-employee/retirement-topics-tax-on-early-distributions Did you indicate "rollover" on your tax return on line 16b? This is criti...
by Alan S.
Sat Feb 16, 2019 10:48 pm
Forum: Personal Finance (Not Investing)
Topic: Roth re characterization help
Replies: 3
Views: 150

Re: Roth re characterization help

Yes, you could do a partial recharacterization of the amount of the contribution that would eliminate some or all of the 22% bracket, but ONLY after you verified that the TIRA contributions would be deductible considering at their modified AGI. But they should not recharacterize if they are expected...
by Alan S.
Sat Feb 16, 2019 7:06 pm
Forum: Personal Finance (Not Investing)
Topic: Brokerage account with beneficiaries has to go through probate?
Replies: 2
Views: 408

Re: Brokerage account with beneficiaries has to go through probate?

The friend may not realize what a TOD is. A transfer due to operation of law like a TOD, POD, account beneficiary etc allows the asset to pass outside of probate. One technical problem you may run into is how to settle your limited estate when almost all the value passes outside of probate. No funds...
by Alan S.
Sat Feb 16, 2019 6:56 pm
Forum: Personal Investments
Topic: Changing from Roth to IRA
Replies: 14
Views: 889

Re: Changing from Roth to IRA

Depending on the details, the chances for the greatest benefit of deductible TIRA contributions is before the first parent retires, which leaves very little time. If 2018 Roth contributions were already made, they can be recharacterized as TIRA contributions, but only if the TIRA contributions will ...
by Alan S.
Fri Feb 15, 2019 10:21 pm
Forum: Personal Finance (Not Investing)
Topic: Fun with Form 8606 Part 3
Replies: 2
Views: 461

Re: Fun with Form 8606 Part 3

I'm waiting for Form 8606 to become available through Free Fillable Forms, so just looking for a gut check to make sure I read the instructions correctly. This is the first time I've done this form myself. I know I won't owe any penalty but since the contents of this form roll forward forever as ba...
by Alan S.
Fri Feb 15, 2019 10:01 pm
Forum: Personal Investments
Topic: Withdrawing contributions from Roth 401k after rollover to Roth IRA
Replies: 5
Views: 403

Re: Withdrawing contributions from Roth 401k after rollover to Roth IRA

I have researched this and am still uncertain. I am 45. I have a Roth IRA which I contributed to more than 5 years ago. I have a Roth 401k, all contributions were more than 5 years ago. (huge gains in this) If I were to FIRE now, could I rollover my Roth 401k to my Roth IRA and begin withdrawing my...
by Alan S.
Fri Feb 15, 2019 8:15 pm
Forum: Personal Finance (Not Investing)
Topic: Mega Backdoor Roth and 1099-R taxable income
Replies: 12
Views: 1667

Re: Mega Backdoor Roth and 1099-R taxable income

You mean that your Box 2a plus Box 5 do not add up to the Box 1 amount?
by Alan S.
Fri Feb 15, 2019 8:06 pm
Forum: Personal Finance (Not Investing)
Topic: IRS Form 8606 Free File Fillable Forms
Replies: 6
Views: 771

Re: IRS Form 8606 Free File Fillable Forms

After two straight years, it looks like this delay will become an annual event, at least for FFFFs.

Completion of the 8606 Inst might be driving this delay, as there are more changes to the Inst than there is to the 8606 itself.
by Alan S.
Fri Feb 15, 2019 7:54 pm
Forum: Personal Investments
Topic: Beneficiary IRA - RMD's
Replies: 4
Views: 581

Re: Beneficiary IRA - RMD's

No, you should not wait until 12/31/2019. You should immediately take the appropriate RMDs for 2011 - 2018. Then file each year's Form 5329 requesting a waiver. If you exactly follow the Form 5329 Instructions for requesting a waiver for "reasonable cause". The IRS will almost certainly grant the w...
by Alan S.
Wed Feb 13, 2019 7:30 pm
Forum: Personal Investments
Topic: Excess Roth Contribution
Replies: 6
Views: 382

Re: Excess Roth Contribution

You should see this in your consolidated 1099 from Vanguard when the dust clears. We had excess contributions last year because our income put us into the phase out area. Our CPA told us how much to pull out of each Roth and we called Fidelity and Schwab and filled out "return of excess contributio...
by Alan S.
Wed Feb 13, 2019 7:26 pm
Forum: Personal Investments
Topic: Excess Roth Contribution
Replies: 6
Views: 382

Re: Excess Roth Contribution

The contribution for 2018 was $6449, since I showed $51 earned income. I did a solo401K and that took care of most of my earned income. It would make sense that the tax implications on the profit would show up in 2019, since that is when I made the withdrawal. Thanks for the feedback. Not correct. ...
by Alan S.
Wed Feb 13, 2019 5:34 pm
Forum: Personal Investments
Topic: Excess IRA contribution with no earnings
Replies: 2
Views: 203

Re: Excess IRA contribution with no earnings

Over-contributed to my Vanguard IRA but has no earnings. Do I really have to mail this excess contribution to direct Vanguard to withdraw the excess or can I just withdraw it myself? Do I have to file anything with my taxes? If VG does not issue a properly coded corrective distribution 1099R, the I...
by Alan S.
Wed Feb 13, 2019 5:17 pm
Forum: Personal Finance (Not Investing)
Topic: W-2 incorrectly shows excess Roth retirement contributions, any action needed?
Replies: 8
Views: 400

Re: W-2 incorrectly shows excess Roth retirement contributions, any action needed?

The TSP should be automatically distributing the excess $100 by 4/15. If they do not, the plan is subject to possible sanctions. The excess would not affect the 2018 return because these were ROTH deferrals. Any income returned along with the $100 will be taxable in 2019, not 2018, and there is no 1...
by Alan S.
Wed Feb 13, 2019 3:25 pm
Forum: Personal Investments
Topic: Excess Roth Contribution
Replies: 6
Views: 382

Re: Excess Roth Contribution

Turbotax found that I made an excess contribution of $6449 for 2018. Since it is before April 15, 2019, I can withdraw this amount to avoid a penalty. When I called Vanguard to remove the $6449, they said I had earned $315.27 on my investment. Turbotax has a spot to enter 'Contribution Withdrawn Be...
by Alan S.
Wed Feb 13, 2019 1:41 pm
Forum: Personal Finance (Not Investing)
Topic: How To Fix Excess Roth Removal With Amended Return
Replies: 10
Views: 624

Re: How To Fix Excess Roth Removal With Amended Return

Since I withdrew contributions+interest back in March 2018 before the tax filing deadline, I read the above "treated as an amount not contributed" as indicating there wouldn't be a penalty on it. No? There wouldn't be a 6% excise tax on most of the excess, since you removed MOST OF the excess contr...
by Alan S.
Mon Feb 11, 2019 9:26 pm
Forum: Personal Investments
Topic: Roth withdraw, less than 5 years, less than 59 years old
Replies: 15
Views: 1038

Re: Roth withdraw, less than 5 years, less than 59 years old

Your 1099R would have been for the year you did the mega back door, which was apparently a couple years ago. So your tax filing was done then. From there you just need some method of keeping track of the composition of your Roth IRA (amount of regular or conversion basis, applicable years for conver...
by Alan S.
Mon Feb 11, 2019 6:57 pm
Forum: Personal Investments
Topic: Roth withdraw, less than 5 years, less than 59 years old
Replies: 15
Views: 1038

Re: Roth withdraw, less than 5 years, less than 59 years old

.............................................. OK, so you did a Notice 2014-54 split direct rollover to TIRA and Roth IRA. ...................................................... Trying to understand how the qualified plans to Roth IRA works. In this case only the after-tax funds went to Roth so thi...
by Alan S.
Mon Feb 11, 2019 4:23 pm
Forum: Personal Investments
Topic: Roth withdraw, less than 5 years, less than 59 years old
Replies: 15
Views: 1038

Re: Roth withdraw, less than 5 years, less than 59 years old

I'm 53 and have a had a Roth for a couple years via: After Tax 401K --> Roth IRA ("mega back door" route) Suppose I bought $5000 in each of two funds, but today the values are $4800 and $5500. So 10K in, 10.3K today Can i withdraw the $4800 without penalty since that *holding* has no earnings? (dow...
by Alan S.
Sun Feb 10, 2019 11:37 pm
Forum: Personal Investments
Topic: Married filing separately IRA question
Replies: 1
Views: 199

Re: Married filing separately IRA question

My wife and I both make around 70k. We are also only able to do Married filing separately. Is there any point to doing traditional IRA investments because we can't take a deduction anyways? Maybe to just backdoor Roth the entire amount every year? I assume you both are active participants in a work...
by Alan S.
Sun Feb 10, 2019 9:57 pm
Forum: Personal Finance (Not Investing)
Topic: 1099-R and Mega Backdoor Issue using TurboTax
Replies: 3
Views: 392

Re: 1099-R and Mega Backdoor Issue using TurboTax

The root cause of this problem is that when there are two transactions that have different instructions for a 1099R box (Boxes 2a and 5 in this case), the 1099R Inst should state that a separate 1099R form is required for each. The instructions fail to do that. Since this is not stated, 1099R issuer...
by Alan S.
Sat Feb 09, 2019 6:50 pm
Forum: Personal Investments
Topic: question on an inherited IRA
Replies: 24
Views: 1440

Re: question on an inherited IRA

IRS letter rulings throughout the years have consistently found that an executor can assign inherited IRAs out of the estate to the beneficiaries of the estate. However, there are still some custodians that throw out roadblocks to this process. Pressure applied to the custodian will usually work, bu...