Search found 6002 matches

by Artsdoctor
Mon Mar 18, 2024 6:08 pm
Forum: Personal Investments
Topic: Can TIPS in a taxable account make sense?
Replies: 4
Views: 429

Re: Can TIPS in a taxable account make sense?

Most professional financial advisors will tell you to hold TIPS in your tax-deferred accounts. Nonetheless, there are some tax-savvy investors who have no problems with TIPS in taxable accounts.

Before you do that however,, make sure that you understand the tax consequences. If you don't fully understand how TIPS work, don't do it. If you don't understand OID and phantom income, don't do it.

If you want to keep things as simple as possible, consider taking the taxable bond funds in your tax-deferred accounts and purchasing an equivalent sum of munis in your taxable account. You'd then free up some space in your tax-deferred account to buy TIPS. There are many ways to handle it although I'd argue for putting a premium on simplicity.
by Artsdoctor
Mon Mar 18, 2024 3:57 pm
Forum: Personal Finance (Not Investing)
Topic: Medicare: Getting Part A and D only
Replies: 40
Views: 2018

Re: Medicare: Getting Part A and D only

gunny2 wrote: Sun Mar 17, 2024 8:15 pm Thanks for the replies. huh...I guess I always figured if you have to go to the hospital for something (eg chemo etc), it's Part A.

Being a vet who'll get Tricare for Life (and services at any base), I still wonder if it's not worth considering.
You really need to look into what your benefits are for Tricare For Life. Tricare and TFL are two different things. TFL is meant as a Medicare supplement.
by Artsdoctor
Mon Mar 18, 2024 10:12 am
Forum: Personal Finance (Not Investing)
Topic: Medicare: Getting Part A and D only
Replies: 40
Views: 2018

Re: Medicare: Getting Part A and D only

gunny2 wrote: Sun Mar 17, 2024 8:15 pm Thanks for the replies. huh...I guess I always figured if you have to go to the hospital for something (eg chemo etc), it's Part A.

Being a vet who'll get Tricare for Life (and services at any base), I still wonder if it's not worth considering.
There's a terrific book called "Medicare for Dummies." It covers a lot of ground and will be more than you need, but there is a section for federal employees and Tricare recipients.

These governmental plans are pretty unique, so just make sure that when getting advice from people that you understand most people won't be all that familiar with the federal benefits programs.
by Artsdoctor
Mon Mar 18, 2024 10:07 am
Forum: Investing - Theory, News & General
Topic: Taxation of Treasury bills, notes and bonds
Replies: 1027
Views: 149361

Re: Taxation of Treasury bills, notes and bonds

This has been an invaluable thread on multiple levels. I'm probably the last to realize this, but it's become apparent that a lot of people are having more difficulty in software data entry than actually understanding the "taxation of treasury bills, notes and bonds." As more and more people do their own taxes and rely solely on tax software, falling back to simplicity may be the best option for many people. We can offer insights as to how T-notes might be purchased and sold on the secondary market as well as how such transactions might be taxed, but I'd caution recommending doing so for most investors in taxable accounts. Teaching investors how investments are taxed is sometimes challenging enough; teaching them how to enter comp...
by Artsdoctor
Sun Mar 17, 2024 3:03 pm
Forum: Personal Finance (Not Investing)
Topic: Estimating RMD Taxes for Retirement Planning
Replies: 15
Views: 1806

Re: Estimating RMD Taxes for Retirement Planning

I understand that it might be beneficial to "guesstimate" future tax liabilities. You can make some gross generalities that might allow you to plan a Roth conversion, donate to charities, etc. I might suggest that you plan for where those "holes" are in your tax-planning strategies, though. Some things are indexed to inflation and somethings are not, for example; it might be helpful to know where the large factors are that are not indexed to inflation. There's been a lot of planning associated with social security taxation, for example. But if you're really trying to not be "fully taxed" (meaning, not have 85% of your benefits taxed), you might be setting yourself up to fail. Your benefits will be indexed to in...
by Artsdoctor
Sat Mar 16, 2024 12:06 pm
Forum: Personal Finance (Not Investing)
Topic: Estimating RMD Taxes for Retirement Planning
Replies: 15
Views: 1806

Re: Estimating RMD Taxes for Retirement Planning

Like most, you're probably using a tax software program. This can help quite a bit. First, you can read up on safe harbor rules for next year's tax planning. This can give you a rough estimate on what you might want to contribute to your Estimate Tax Payments in order to avoid a penalty. Second, you can use the tax software to project your income and tax liability for the following year. For example, TurboTax offers a "What-If" scenario that allows you to put in your income and get a rough idea of your taxable income. If you'd prefer to have your tax withheld from your RMD, that's also a possibility that your tax software can help you with. It's probably not worth your time to start calculating out more than a year in the future s...
by Artsdoctor
Sat Mar 16, 2024 10:34 am
Forum: Personal Investments
Topic: Ditching Wellesley to Minimize Income, Which ETFs?
Replies: 20
Views: 1673

Re: Ditching Wellesley to Minimize Income, Which ETFs?

As you noted, these will all throw significant dividends, which will increase your AGI for tax-filing. I'm assuming that Wellesley is held in a taxable account... This doesn't have anything to do with federal taxes or AGI, or taxable or nontaxable accounts. NY adds any income/dividends, even if they are in an IRA or Roth account. So the goal is to minimize. I'm not a NY resident but that bolded statement about IRAs sounds wrong. In general, when you make a withdrawal from a Traditional IRA that counts toward income. When you withdraw you withdraw from the account, not from a particular "source" inside the IRA like dividends or basis or growth. Roth IRA distributions don't count toward income (assuming qualified withdrawals). Do y...
by Artsdoctor
Fri Mar 15, 2024 7:14 pm
Forum: Personal Investments
Topic: Ditching Wellesley to Minimize Income, Which ETFs?
Replies: 20
Views: 1673

Re: Ditching Wellesley to Minimize Income, Which ETFs?

As you noted, these will all throw significant dividends, which will increase your AGI for tax-filing. I'm assuming that Wellesley is held in a taxable account... This doesn't have anything to do with federal taxes or AGI, or taxable or nontaxable accounts. NY adds any income/dividends, even if they are in an IRA or Roth account. So the goal is to minimize. If you don't have any options for other places to hold bonds and they must go in the taxable account, then Vanguard Tax-Managed Balanced Fund Admiral Shares (VTMFX) is something to consider... If you check the BH Wiki at the link I provided, the argument is that the two index fund ETFs together are better than VTMFX. Comments elsewhere on BH re BRK.B raise concerns that it is equivalent...
by Artsdoctor
Fri Mar 15, 2024 3:04 pm
Forum: Personal Finance (Not Investing)
Topic: Health Equity Bank Linking
Replies: 3
Views: 292

Re: Health Equity Bank Linking

Health Equity gives you the opportunity to match disbursements with expenses on their website but you don't have to use their expense list. If you like, you can create your own folder without uploading any receipts (say, call the folder Expenses 2015), put in the expense amount for that year, and then link your distribution to that folder.

Personally, I keep my own records and I don't upload any receipts to a broker's site. When you leave that broker, you'll lose access to that account so eventually all of those uploaded files won't matter to you.
by Artsdoctor
Thu Mar 14, 2024 5:55 pm
Forum: Personal Investments
Topic: Looking for info/advice from Californians investing with an HSA
Replies: 49
Views: 4960

Re: Looking for info/advice from Californians investing with an HSA

If you've been reinvesting the dividends all along, you'll want to keep track of those because they steadily increase your cost basis. This is important because you don't want to be taxed twice (you've already been taxed on the dividends and you won't be taxed again when you sell). I must be misunderstanding. You'll still be taxed on capital gains from dividend lots, yes? Absolutely. At some point, at least in California, you'd be taxed when you start selling. There's really not a lot you can do to get away from some sort of taxation but you can control how much (to some extent). If you have a short-term treasury fund, it's unlikely that you'd have large amounts of capital gains although in periods of interest rate swings, you never know. ...
by Artsdoctor
Wed Mar 13, 2024 9:32 pm
Forum: Personal Finance (Not Investing)
Topic: At what point did you prioritize health over money?
Replies: 53
Views: 6068

Re: At what point did you prioritize health over money?

What specifically are you debating? I feel like I have both my health and money. I am curious about how other Bogleheads approach life, I suppose! I feel like way too much of my time is consumed by thoughts of financial planning, and I always feel like I’m three steps behind (especially reading this forum!) And I also feel like the mental stress of always thinking about money deprives me of the ability to fully live in the present. It seems like there’s always the next financial goal to reach. When is it “done?” Even at retirement, there are RMDs, Roth conversions, or whatever. I’m wondering if the successful folks on this forum are truly able to “win the game” in a way that frees them from committing so much time to finances, and instead ...
by Artsdoctor
Wed Mar 13, 2024 9:20 pm
Forum: Personal Investments
Topic: Looking for info/advice from Californians investing with an HSA
Replies: 49
Views: 4960

Re: Looking for info/advice from Californians investing with an HSA

I will have a couple of years after I start receiving Social Security benefits (and thus no longer will be converting IRA to Roth) but before I start RMDs when my CA taxable income will be close to zero. I am considering withdrawing all the funds from my HSA during those years to avoid or minimize the CA income tax on the realized gains. This will not only avoid the tax, but will also close my HSA, which is only a small portion of my overall portfolio. I'm generally trying to consolidate as many accounts as possible. I agree that simplification has its merits. Another option you might consider is selling your appreciated assets in the HSA as you stated, but leave those sales in a treasury fund (if it's available to you). That way, you can ...
by Artsdoctor
Wed Mar 13, 2024 6:38 pm
Forum: Personal Finance (Not Investing)
Topic: Your experience-Vanguard Charitable Endowment Program?
Replies: 16
Views: 2243

Re: Your experience-Vanguard Charitable Endowment Program?

I have both Fidelity and Vanguard DAFs. I had heavily appreciated assets at both, and I wanted to verify that the specific lots I wanted to donate were actually donated correctly. I don't have any regrets. I use Vanguard for large grants (donations) and Fidelity for relatively small grants. It's very easy to transfer from the Vanguard DAF to the Fidelity DAF if I have to (the bulk of donated shares are at Vanguard). I transfer a Vanguard ETF with the lowest cost basis to Vanguard Charitable in the morning and it's there the next day. They make take a couple of days to sell and credit the account. Many, many years ago (before we had DAFs), I also found it cumbersome to donate appreciated Vanguard mutual fund shares directly to smaller charit...
by Artsdoctor
Tue Mar 12, 2024 1:17 pm
Forum: Personal Investments
Topic: California Tax-Exempt Bond ETF - thoughts?
Replies: 42
Views: 5244

Re: California Tax-Exempt Bond ETF - thoughts?

I will offer this. I purchased VTES (the short-term Vanguard tax-exempt ETF) in my Fidelity brokerage account late last year. When I got my 1099, the "tax-exempt" dividends were coded as fully taxable Ordinary Income. Fidelity says that they report out what Vanguard gives them, and Vanguard says that everything is accurate on their end. No one really took responsibility for this, and I wound up selling my holdings because there was no resolution. I also hold VTEB at Fidelity and those dividends were reported out correctly. So my advice would be to invest in new funds/ETFs judiciously, and perhaps begin purchasing this new ETF (VTEC) if not at Vanguard at the end of the year to make sure that the dividends are reported correctly. S...
by Artsdoctor
Tue Mar 12, 2024 1:09 pm
Forum: Personal Finance (Not Investing)
Topic: Using Tax Refund for Estimated Taxes
Replies: 7
Views: 721

Re: Using Tax Refund for Estimated Taxes

Your tax software will handle it--if you use the same software program.
by Artsdoctor
Tue Mar 12, 2024 10:52 am
Forum: Personal Finance (Not Investing)
Topic: One spouse retiring earlier than the other?
Replies: 38
Views: 2989

Re: One spouse retiring earlier than the other?

It's great that you're both talking about it. That doesn't always happen. Keep the conversations going. "Retiring" can be a bit of a shock and if two spouses do it together, it has the potential of being even a bigger shock. It's not insurmountable but it really becomes important to keep the conversations going if you're doing it together. If you really like what you're doing, make a case that your job is contributing to your happiness and is important--for now--for guiding your sense of purpose. If you have a strong relationship, I'm not sure how she could argue with that. You can also say that you'll retire one day and watching her grow in retirement might offer some guidelines for you as well when you ultimately retire. You can...
by Artsdoctor
Tue Mar 12, 2024 10:45 am
Forum: Personal Finance (Not Investing)
Topic: Using Tax Refund for Estimated Taxes
Replies: 7
Views: 721

Re: Using Tax Refund for Estimated Taxes

The 2023 refund will be credited for the First Quarter, not distributed equally throughout the year.
by Artsdoctor
Mon Mar 11, 2024 6:41 pm
Forum: Personal Finance (Not Investing)
Topic: Any reason for a 401(k) if already maxing out a 403(b)?
Replies: 4
Views: 551

Re: Any reason for a 401(k) if already maxing out a 403(b)?

Thanks for that information. I was not aware of the special catch-up available to some 403b employees so I'm happy to have that info.

Take a look at this IRS publication. Although you're subject to certain limitations when combining 401 and 403 plans for the year, 457s are separate. So you may be able to have the best of all worlds if this applies to you:

https://www.irs.gov/retirement-plans/ho ... ement-plan
by Artsdoctor
Sun Mar 10, 2024 5:27 pm
Forum: Personal Investments
Topic: IRA allocation with RMDs not needed for living expenses
Replies: 8
Views: 855

Re: IRA allocation with RMDs not needed for living expenses

The RMDs may not be needed but all of the money in your tax-deferred account will have to go somewhere eventually. If the RMDs are truly not needed right now, then ask yourself what your estate plans are. Where do you want that money to go? Do you want to give the money to charities? Do you want to give to family? If to the family, how do you want to do that? How many beneficiaries do you want? Do you want to grow the tax-deferred accounts as much as possible (for legacy purposes) or do you want to slow down the growth as much as possible (to decrease the taxable RMD amounts)? If you design your plan first, then executing it will be easy.
by Artsdoctor
Sun Mar 10, 2024 5:11 pm
Forum: Investing - Theory, News & General
Topic: "When" do you sell equities during Retirement?
Replies: 29
Views: 4402

Re: "When" do you sell equities during Retirement?

Hello and welcome! You will wind up getting a whole bunch of different answers as drawdown is going to be unique to each individual based on how their portfolio was built during the accumulation phase and if they picked a strategy prior to retirement. Some may be high in equity allocations, some may have everything in tax-deferred accounts, some will have a blend, and some might have a few single stocks representing a large portion of their portfolio. Just out of curiosity, how far are you away from retirement? Agreed, everyone has a unique path! I hope to work into my late 50s (56-59), so for another 12-15 years. My assets are currently about 45% taxable account, 45% tax deferred, 10% Roth. I also invest inside an HSA. You are doing great...
by Artsdoctor
Sun Mar 10, 2024 1:41 pm
Forum: Personal Finance (Not Investing)
Topic: QCDs before age 73?
Replies: 30
Views: 2439

Re: QCDs before age 73?

I think that this thread is a perfect example of a Rorschach test. Are we talking about QCDs in general, or are we talking about the OP's question regarding QCDs as they pertain to their particular situation? The OP has an intriguing and unusual set-up. Evidently, the OP and his wife converted the "overwhelming" majority of their tax-deferred accounts to Roth IRAs and purposely left some IRA monies in the tax-deferred accounts for the purpose of future QCDs IN LIEU OF RMDs. Those QCDs would replace the current amount they're giving in the form of cash. It's not common to intentionally convert everything you're going to spend from an IRA to Roth, and then leave behind just enough in the IRAs solely for charitable contributions. It'...
by Artsdoctor
Sun Mar 10, 2024 12:05 pm
Forum: Investing - Theory, News & General
Topic: Foreign Tax Credit eligibility of BNDW
Replies: 5
Views: 534

Re: Foreign Tax Credit eligibility of BNDW

In general, any fund or ETF has to contain at least 50% in international holdings to even be eligible for the foreign tax credit.
by Artsdoctor
Sat Mar 09, 2024 5:44 pm
Forum: Personal Consumer Issues
Topic: Is Calif Really That Expensive - Or Am I Missing Something?
Replies: 133
Views: 15481

Re: Is Calif Really That Expensive - Or Am I Missing Something?

I'm trying to decide between CA and NV to live (have the luxury of not being tied to the location of a job). In general, I slightly prefer CA due to variety - mountains, coastline, wine country, cultural/sports events, etc - though NV is very beautiful in its own right. However, when comparing costs, I'm amazed how much cheaper NV prices out, especially in terms of electricy, property taxes, income taxes, HOA fees, gas, etc. It seems one of the main financial incentives for Californians is very long-term home ownership, since property taxes hardly ever increase if you hold the home as your primary residence. However, this doesn't help a new home buyer. (NV has something similar but new buyers inherit the tax rate of the sellers.) Am I miss...
by Artsdoctor
Sat Mar 09, 2024 5:32 pm
Forum: Investing - Theory, News & General
Topic: Record keeping for HSA when deferring reimbursement for many years
Replies: 26
Views: 2636

Re: Record keeping for HSA when deferring reimbursement for many years

^ We've had so many threads on HSA expense documentation, and I'm very sensitive to avoiding any red flags on our tax returns. And as a physician, I'm also very sensitive to how high these deductibles and co-pays can really be when a family is dealing with medical needs. These out-of-pocket "maximums" for HDHPs have become overwhelming for a lot of people and I don't think the IRS is going to target distribution amounts in these ranges nowadays. Documentation is always important when it comes to taxes, but I don't think that people should feel obligated to limiting their distributions from their HSAs if their expenses start approaching the out-of-pocket maximum for their plans.
by Artsdoctor
Sat Mar 09, 2024 5:01 pm
Forum: Personal Finance (Not Investing)
Topic: QCDs before age 73?
Replies: 30
Views: 2439

Re: QCDs before age 73?

^ I agree with jebmke.

Maybe the 1040 is etched into my brain right now since it's tax season. But I'm trying to follow the previous statement suggesting that a QCD affect your AGI. It really doesn't.

Most people do not itemize nowadays because the standard deduction is so high but if you do, you'd be itemizing on Schedule A and taking your charitable contributions there. That deduction doesn't affect your AGI either (your AGI is the same whether you itemize or not).
by Artsdoctor
Sat Mar 09, 2024 4:50 pm
Forum: Personal Finance (Not Investing)
Topic: Any reason for a 401(k) if already maxing out a 403(b)?
Replies: 4
Views: 551

Re: Any reason for a 401(k) if already maxing out a 403(b)?

I'm more familiar with "catch up" being used for employees who are 50+. When you say you have a $3,000 catch up option for your 403b, can you clarify that a bit? Perhaps noting what your maximum contributions for this year would be might help.
by Artsdoctor
Sat Mar 09, 2024 4:46 pm
Forum: Investing - Theory, News & General
Topic: Record keeping for HSA when deferring reimbursement for many years
Replies: 26
Views: 2636

Re: Record keeping for HSA when deferring reimbursement for many years

^ I'm not sure why someone would put a limit of $5,000-$8,000 on distributions from an HSA in any given year. For 2024, the maximum out of pocket expense for an individual plan is $9,450 and for a family, it's $18,900. If you have the receipts, I wouldn't hesitate to reimburse yourself if you need it for at least those amounts. I don't want people to think that can't use their HSAs to their fullest potential if necessary for any given year.
by Artsdoctor
Sat Mar 09, 2024 4:38 pm
Forum: Personal Finance (Not Investing)
Topic: QCDs before age 73?
Replies: 30
Views: 2439

Re: QCDs before age 73?

kcolman wrote: Sat Mar 09, 2024 11:52 am
jebmke wrote: Mon Mar 04, 2024 5:27 pm
GenawithanE wrote: Mon Mar 04, 2024 5:23 pm Are you on Medicare? are you paying, or at risk of paying IRMAA? QCDs reduce your MAGI whereas deductions do not.
Not until you are drawing RMDs; QCDs have no impact on MAGI before then.
When withdrawing from tax deferred retirement accounts, QCDs get deducted from your taxable income on page 1 of the 1040, so they do have an impact on MAGI even before you reach the RMD age.
Can you clarify what you mean here? QCDs are not part of your adjusted gross income at all, so what would they be reducing prior to RMD age?
by Artsdoctor
Thu Mar 07, 2024 6:05 pm
Forum: Personal Finance (Not Investing)
Topic: Your Original Medicare OR Advantage Experience: Nightmare or Sublime?
Replies: 156
Views: 9910

Re: Your Original Medicare Experience: Nightmare or Sublime?

Medicare sequestration began in 2013. This effectively reduced Medicare payments for all services and the reimbursement over the past decade has been falling, especially apparent in real terms. There are some physicians who have opted out of Medicare overall but this is a very small percentage. While hospitals have continued to accept all Medicare patients, physician practices may not be able to see new Medicare patients in a timely way. This is across the board and it doesn't make any difference if it's for a new primary care physician or a consultation. This is usually most obvious when new appointments are requested, rather than follow-ups. This problems has only been amplified as more and more physicians have retired during the pandemic...
by Artsdoctor
Thu Mar 07, 2024 1:19 pm
Forum: Personal Finance (Not Investing)
Topic: Another Medicare Advantage Discussion - Let's have some facts
Replies: 22
Views: 1297

Re: Another Medicare Advantage Discussion - Let's have some facts

Some of the facts you're wanting may not have the data yet. The biggest question that's being asked is, "Are health outcomes different?" To the best of my knowledge, large and unbiased studies have not concluded the answer to this question. There are a lot of variables. Some pieces of information to help. First, when you're looking at studies, ask yourself who's funding the study. For example, the two links at the beginning offered eHealth and KFF links--eHealth is funded by insurance companies whereas KFF is not. It doesn't necessarily negate a study or report, but ask yourself if there might be a motive for a particular outcome (or conversely, for not publishing an outcome they're not interested in). But second, you'll need to l...
by Artsdoctor
Wed Mar 06, 2024 6:41 pm
Forum: Personal Finance (Not Investing)
Topic: Tax Bracket Confusion
Replies: 11
Views: 1625

Re: Tax Bracket Confusion

The reason for the "tax bracket confusion" is because it IS confusing. At this point, using a tax software package is the only way to know what an added $100 to your adjustable gross income is going to do to your marginal federal rate. There's earned income (not subject to NIIT). There's investment income (subject to NIIT), including qualified versus non-qualified dividends. There's tax-exempt, which affects your MAGI but not your AGI. There's the taxation of social security benefits which REALLY be a shocker. There's capital gains discussed above. And there are hidden taxes (like Medicare premium surcharges). The published tax brackets are guides and you can use them but know there are hidden items affecting your marginal tax bra...
by Artsdoctor
Wed Mar 06, 2024 6:22 pm
Forum: Investing - Theory, News & General
Topic: Record keeping for HSA when deferring reimbursement for many years
Replies: 26
Views: 2636

Re: Record keeping for HSA when deferring reimbursement for many years

I have some ambivalence about what an EOB is good for. It will give you the itemization but, at least in my experience as a doctor, doesn't always translate into what you've paid. In other words, it'll say what you might owe, but it doesn't really give you the final tally of what you've paid. It can also be amended and balances can be written off or reduced. For my files, I have the bill which lists the services and I have how much I paid and how I paid it. You can take the EOB and do something similar--just write what you paid and how you paid it. You can really get into the weeds with documentation but as others have said, I think you just have to do what's reasonable. You could print out your insurance card to prove that it's HDHP (it us...
by Artsdoctor
Wed Mar 06, 2024 3:42 pm
Forum: Personal Finance (Not Investing)
Topic: Is it Time to Self-Insure? CA Homeowners Rate Increases
Replies: 118
Views: 8837

Re: Is it Time to Self-Insure? CA Homeowners Rate Increases

300% seems remarkable, it appears they were approved for a 28.1% increase. For various reasons, CA homeowner's insurance prices have been held down compared to other markets, so the insurance department is attempting to catch up rates by allowing large increases (historically getting anything past 10% was pretty much impossible.) Are you in a wildfire-urban interface zone? You will probably find no other insurers willing to write you a policy. You can look up your property here: https://calfire-forestry.maps.arcgis.com/apps/webappviewer/index.html?id=988d431a42b242b29d89597ab693d008 There are no alternatives other than the state pool aka FAIR plan (which will cost even more and have far worse coverage.) So far there is no solution in sight...
by Artsdoctor
Wed Mar 06, 2024 3:33 pm
Forum: Investing - Theory, News & General
Topic: Record keeping for HSA when deferring reimbursement for many years
Replies: 26
Views: 2636

Re: Record keeping for HSA when deferring reimbursement for many years

I think you're doing a good job with documentation already. The concept is: itemized bill with documentation that you paid it. The thing that starts getting complicated is if you're deducting medical expenses on Schedule A and you're also taking distributions from your HSA. This is perfectly fine, of course: you can take distributions from your HSA for expenses in 2020 but take medical expense itemization on bills you paid in 2023 (for example). But the idea would be to prove that you're not double-dipping if you're challenged.
by Artsdoctor
Wed Mar 06, 2024 3:26 pm
Forum: Personal Finance (Not Investing)
Topic: Giving (unequal) money to adult children
Replies: 90
Views: 8257

Re: Giving (unequal) money to adult children

I will give my perspective from that of one of the adult children. My sister is much less well off than my wife and I. Some of that is poor decisions, some of that is due to a divorce and some of that is due to having a job in a declining industry which led to declining income which led to mental health issues and disability in her early sixties. Tack on a cancer fight to that. My parents have helped her financially by sending $500/mo. for several years. We did not know this initially but my parents eventually told me as their health declined and I started helping my sister with her finances. While they’ve done a few nice things for us as well, I am sure they helped her more as she needed more help. My mom always said she was keeping track...
by Artsdoctor
Wed Mar 06, 2024 3:17 pm
Forum: Personal Finance (Not Investing)
Topic: Filing a deceased parent's 1099
Replies: 8
Views: 960

Re: Filing a deceased parent's 1099

There's probably the "right way" to enter the interest income and if your mom uses an accountant, the CPA will know that.

But there's probably a "good enough" way to do it if there's no accountant. On your mom's Schedule B, there will be a place to enter interest adjustments (you'll see several blank lines). On a line, you might consider writing something like "DECEASED SPOUSE INTEREST RECEIVED: JOHN DOE, SSN 111-12-3456".

It's possible that your mom might get a letter from the IRS asking for clarification but it would be easy enough to respond that the interest was declared and the taxes were paid. It pertains to a deceased spouse so it shouldn't be difficult to clear it up.
by Artsdoctor
Wed Mar 06, 2024 3:03 pm
Forum: Personal Finance (Not Investing)
Topic: When to Actually Use my HSA Funds
Replies: 27
Views: 2533

Re: When to Actually Use my HSA Funds

Hogan: As you've seen, there is no perfect answer--just what's right for you. At this point in your life, let the account grow if you can. One thing, though. If the thing you're looking for is flexibility, make sure you do keep those medical receipts because if you're reimbursing yourself later on, you should have the ability to show what the reimbursement is for. You say you have a folder, but I'll tell you from personal experience that some of those receipts tend to fade over time (especially thermal paper). So the only advice I'd really offer is to scan the receipts that have relatively large amounts and keep the data safe. Otherwise, just know the basic rules (what expenses are reimbursable, make sure your state recognizes the tax-favor...
by Artsdoctor
Wed Mar 06, 2024 1:03 pm
Forum: Personal Finance (Not Investing)
Topic: Donating appreciated stock
Replies: 11
Views: 674

Re: Donating appreciated stock

The info so far sounds generally correct to me, but there are some additional annoying details. One is that your tax deduction for the entire fair market value depends on how long you've held the asset. If held more than one year, you get to deduct the FMV, but if held less, you can only deduct the smaller of (current value) and (cost basis). I don't know how your holding period is defined for inherited stocks -- is it the original purchase date by the deceased, or the date you inherited it? If you want to be extra sure, I'd wait until a full year after the inheritance was received. Or if you want to donate sooner, maybe you could find clear guidance on the IRS website -- not sure. Best wishes. Inherited assets are considered LONG regardle...
by Artsdoctor
Wed Mar 06, 2024 12:55 pm
Forum: Investing - Theory, News & General
Topic: Help me understand which T-bill to buy
Replies: 12
Views: 1377

Re: Help me understand which T-bill to buy

^ It's certainly easy to buy on the secondary market. However, in this case, he appears to be interested in buying only $5,000. Being "out of the market" isn't really a significant factor. He also has no experience with treasuries (no differentiation between a bill and a note, unfamiliar with taxation). For these reasons, it might be beneficial to start simply and get experience with the process. Buying $5,000 at auction is easy and straightforward, and once he becomes more familiar with the process, can move on to secondary market purchases. But that's just my own advice--certainly he can learn at any pace that's comfortable for him.
by Artsdoctor
Wed Mar 06, 2024 10:11 am
Forum: Investing - Theory, News & General
Topic: Help me understand which T-bill to buy
Replies: 12
Views: 1377

Re: Help me understand which T-bill to buy

First question: Is this is a taxable account, or a tax-advantaged account?

Second question: If a taxable account, will you most likely hold the investment until it matures?

It sounds as if you're just getting started with investing in treasuries; so, if this is in a taxable account and you're pretty sure you'll hold until maturity, definitely buy the T-bill (not the T-note).

All of that said, the amount you're investing is very small so why not just buy a 6-month T-bill at the next auction? The auctions are weekly and you'll get the same price as institutional investors.
by Artsdoctor
Wed Mar 06, 2024 8:59 am
Forum: Personal Finance (Not Investing)
Topic: If I own a house for 30 years and I replace the roof twice, do both replacements count as capital improvements?
Replies: 80
Views: 9862

Re: If I own a house for 30 years and I replace the roof twice, do both replacements count as capital improvements?

Still no answer to the question, how are these things tracked by IRS? How common are audits? And this is the question I've come to ask about most things regarding taxes. There are certainly things that the IRS gets to verify: 1099's for example. They have to match and you can file adjustments. I really don't sweat the little things. There are so many ways to interpret things that I can't you'd have red flags over a few dollars. But in some parts of the country, housing costs are extremely high. You can see very big numbers on your return and the tax consequences are substantial. It's hard to imagine that there would be issues with a few thousand dollars in capital gains from a house sale unless someone were being audited for completely oth...
by Artsdoctor
Tue Mar 05, 2024 6:24 pm
Forum: Personal Finance (Not Investing)
Topic: Leaving IRA to DAF (donor advised fund) on death, a sanity check
Replies: 45
Views: 3564

Re: Leaving IRA to DAF (donor advised fund) on death, a sanity check

Careful, your points are very well-taken. Nearly any degree of generosity should be applauded. The thing that I've found over the years is that you can do several things at once, and the most important thing is that it just gets done. You can easily be involved with your local small charity, plus you can go international, plus you can do educational. Whatever's important to you.
by Artsdoctor
Tue Mar 05, 2024 1:13 pm
Forum: Personal Finance (Not Investing)
Topic: Leaving IRA to DAF (donor advised fund) on death, a sanity check
Replies: 45
Views: 3564

Re: Leaving IRA to DAF (donor advised fund) on death, a sanity check

I mean legally and practically. Most nonprofits (except teeny tiny ones) have to be audited every year and the auditors ask all kinds of questions so they have to make sure that they are following the donor's intent, restricting gifts according to the donor's wishes. And, if you like the charity enough to make them a beneficiary, give them some grace for goodness sake. Really, worrying about whether your wishes will be followed 110% is not worth doing since you will, as you point out, be dead. I think that trying to find a charity (or charities) that you're comfortable leaving a large part your estate to is hard work. If you're contributing throughout your lifetime, you can always check up on things (are there scandals? are there changes i...
by Artsdoctor
Tue Mar 05, 2024 1:07 pm
Forum: Personal Finance (Not Investing)
Topic: If I own a house for 30 years and I replace the roof twice, do both replacements count as capital improvements?
Replies: 80
Views: 9862

Re: If I own a house for 30 years and I replace the roof twice, do both replacements count as capital improvements?

The roof improvement is a problem for me. I have a flat roof condo in Arizona and these roofs need to be routinely maintained by patching and coating the entire roof with elasnomer. Otherwise they deteriorate from heat and ponding water and you have leaks. The total cost for this work, done every 3-5 years, is now about $4500 for my small unit, more for larger ones. Does this count as routine maintenance or "roof replacement" such as re-shingling? I think your point gets into the ambiguity that sometimes exists between capital improvements and maintenance. Sometimes it's really not clear. It's fair the ask "what's a new roof anyway?" In Southern California, we also have heat-related issues. The roof is particularly susc...
by Artsdoctor
Tue Mar 05, 2024 9:40 am
Forum: Personal Finance (Not Investing)
Topic: If I own a house for 30 years and I replace the roof twice, do both replacements count as capital improvements?
Replies: 80
Views: 9862

Re: If I own a house for 30 years and I replace the roof twice, do both replacements count as capital improvements?

Yes. I heard a tax preparer [with 20+ years experience] explicitly say in Feb 2024 Zoom meeting that each and every roof replacement added to the basis of a personal residence. When explicitly questioned on it, he repeated it. One shouldn't try to use logic on the US Tax code. Rely on IRS publications, IRS rulings, case law, and experienced tax professionals. [not necessarily in that order] I think that this is one of things where one would say something like, "Hmm, I've read Publication 523 and the IRS specifically says that 'any costs of any improvements that are no longer part of your home cannot be including in your basis.' Can you please clarify how you'd justify your recommendation if it's contrary to the IRS publication?" ...
by Artsdoctor
Mon Mar 04, 2024 6:02 pm
Forum: Personal Investments
Topic: Family HSA with a non-dependent child
Replies: 6
Views: 490

Re: Family HSA with a non-dependent child

^ As a practical matter, I've found that if plans and employment situations are potentially volatile, it's easier to just make monthly contributions rather than trying to make single, larger contributions. Still, even if you overshoot on contributions, you can always back the money out before tax time (along with any earnings from those over-contributions).
by Artsdoctor
Mon Mar 04, 2024 5:59 pm
Forum: Personal Consumer Issues
Topic: What to do if I am subpoenaed as a witness but I have overseas travel plans
Replies: 28
Views: 4084

Re: What to do if I am subpoenaed as a witness but I have overseas travel plans

^ You have nothing to be concerned about. If you're going to get a subpoena, you're getting it under the best of circumstances. You're the witness who did the right thing.

It's scary because it's new for you. Tell them what you know. Your job is just to be truthful and consistent. You might find that one of the lawyers might be gruff, but they have a job to do for their client--it's won't be directed at you personally. They cannot harm you. Generally, they'll want to work with your schedule and for depositions, appointments are usually very flexible.
by Artsdoctor
Mon Mar 04, 2024 5:41 pm
Forum: Personal Consumer Issues
Topic: What to do if I am subpoenaed as a witness but I have overseas travel plans
Replies: 28
Views: 4084

Re: What to do if I am subpoenaed as a witness but I have overseas travel plans

I take it that YOU have a license and that one of the other parties did not.

These subpoenas are extremely common. They want your statement on what you saw. You're not on trial.

I can only say from my and may family's experiences with these things, but the dates for your appearance can be very flexible. You probably got a subpoena for a deposition which can usually be done on a date which suits you. I would be exceptionally surprised if it impacted your travel plans.
You're nowhere near a trial date since the accident just occurred (and it may not even go trial).
by Artsdoctor
Mon Mar 04, 2024 5:35 pm
Forum: Personal Finance (Not Investing)
Topic: Short Term Capital Gains vs Short Term Capital Gain Distributions
Replies: 6
Views: 633

Re: Short Term Capital Gains vs Short Term Capital Gain Distributions

Short-term capital gain distributions create confusion and are utterly useless. The above posters are 100% correct.

The STCG distributions reduce the NAV concomitantly (so you've not benefitted at all), add to the ordinary dividend amount on your 1099-DIV, and cannot be offset by capital losses. Investors should nearly always avoid mutual funds that distribute these things if they're more than miniscule amounts.

These are very different that short-term capital gains you get when you sell an asset. Those can be easily offset with capital losses.

Long-term capital gain distributions can also be offset by capital losses.
by Artsdoctor
Mon Mar 04, 2024 5:23 pm
Forum: Personal Investments
Topic: Family HSA with a non-dependent child
Replies: 6
Views: 490

Re: Family HSA with a non-dependent child

The HSA contribution limits are extremely generous for non-dependent adult children on the plan. Remember, it's the PLAN that decides the limits. So you have a family PLAN. That means that you're allowed to contribute $8,300 for the year. Spouses may split that amount any way they want. If your adult child, who's on the plan, would like to contribute to her own plan, she would be allowed to $8,300 for the year because it's a family PLAN. If you had three other adult children covered by your PLAN, they'd each be able to contribute $8,300! If she were to get her own plan and not be on your family plan, she would have an individual PLAN. That means, she'd only be able to contribute $4,150 to her own HSA while she's on her own individual PLAN. ...