I was so angry upon reading this "advice" that I decided to write my own blog post in response:
http://jofijoseph.weebly.com/jofi-josep ... ngs-advice
Arnott appears perplexed over the fundamental purpose of 401(k) accounts. Hint: they're not supposed to be your rainy day fund.
I welcome any thoughts you may have.
Jofi Joseph
Search found 4 matches
- Tue Oct 21, 2014 1:02 pm
- Forum: Investing - Theory, News & General
- Topic: What Are We Doing To Our Young Investors?
- Replies: 29
- Views: 5231
- Fri May 18, 2012 1:40 pm
- Forum: Personal Finance (Not Investing)
- Topic: IRS Audit - Backdoor Roth
- Replies: 59
- Views: 23586
Re: IRS Audit - Backdoor Roth
I finally got a letter from the IRS, but only acknowledging they received my letter on April 11th and will respond in due time! It takes them a month to simply acknowledge receipt???
The kicker here is they encourage you to pay your assessed back tax in case you are found that you do owe it -- because they remind you that interest continues to accumulate!
Amazing ...
The kicker here is they encourage you to pay your assessed back tax in case you are found that you do owe it -- because they remind you that interest continues to accumulate!
Amazing ...
- Wed Mar 28, 2012 7:33 am
- Forum: Personal Finance (Not Investing)
- Topic: IRS Audit - Backdoor Roth
- Replies: 59
- Views: 23586
Re: IRS Audit - Backdoor Roth
The topic is not correct. What is being described is a standard Roth Conversion .... not a Backdoor Roth. Agree this looks like a bug in the IRS's auditing software. Out of curiosity--what's the difference between a "backdoor roth" and a "standard Roth conversion" where the conversion consists principally of nondeductible contributions? A "standard Roth conversion", as likely intended by the framers of the original legislation, is one where individuals convert Traditional IRAs funded with deductible contributions and/or deductible 401(k) contributions subsequently rolled over into a Roth IRA. Under this scenario, the IRS collects a large tax bill, as you are paying tax not just on the growth in value of the IR...
- Tue Mar 27, 2012 12:32 pm
- Forum: Personal Finance (Not Investing)
- Topic: IRS Audit - Backdoor Roth
- Replies: 59
- Views: 23586
Re: IRS Audit - Backdoor Roth
Hi there, Have lurked on this great message board for a while, never had a reason to register until now. I received the exact same letter yesterday with respect to my Roth IRA conversion in 2010. (Was there something special about March 26, 2012?) The letter was a CP2000 and said I owed $3 K in taxes and penalties for failing to report appropriate income. I had converted $13 K in 2010 from a Traditional IRA to a Roth IRA, and after completing Form 8606, only declared $1074 of that taxable income, since the remaining balance was due to non-deductible contributions I had made in previous years. Exact same situation as Alan S. Was totally freaked out, but now that I see this appears to be a pattern, I'm less stressed. My only issue is that I u...