Search found 2166 matches

by Longdog
Wed Mar 27, 2024 7:12 pm
Forum: Non-US Investing
Topic: Big Mistake! [out of the market]
Replies: 18
Views: 2060

Re: Big Mistake!

If the country where you live will dictate your portfolio, and you don't know what country that will be, it seems like you should first figure that out with a reasonable level of confidence. This would prevent you from creating a portfolio today that you will be rearranging in a year or two because your living situation would change again. I think it would be okay to be in cash or short-term fixed-income securities in the meantime.
by Longdog
Wed Mar 27, 2024 9:54 am
Forum: Personal Finance (Not Investing)
Topic: Take Social Security Now?
Replies: 47
Views: 2366

Re: Take Social Security Now?

every year you defer taking SS up to age 70 adds 8% per year to the eventual payout. And every year you take SS before age 70 gives you a pile of money to spend, invest, or have in the bank. Correct. If you need it to cover your expenses, then it is a no-brainer. Take it now and enjoy your life. (I don't think that was the scenario the OP was asking about.) And if you are certain you can earn at least 8% risk free (or, if you don't consider social security to be a risk-free future income stream, then at the same or lower level of "risk" you deem it to be), then it would be worth considering. Especially if you don't expect to live past the break-even age. The older you live to (beyond the break-even age), the more valuable that an...
by Longdog
Wed Mar 27, 2024 6:51 am
Forum: Personal Finance (Not Investing)
Topic: Take Social Security Now?
Replies: 47
Views: 2366

Re: Take Social Security Now?

LaramieWind wrote: Wed Mar 27, 2024 6:45 am Is it advantageous to take S/S now if it would allow us to not draw from out IRA/Roth? This would also allows us to be more comfortable with a higher percentage in stocks in our AA.
Of course "it depends" but keep in mind, every year you defer taking SS up to age 70 adds 8% per year to the eventual payout. There is, of course, something to be said with being comfortable, even if it's sub-optimal from a pure numbers perspective.
by Longdog
Tue Mar 26, 2024 9:53 am
Forum: Personal Investments
Topic: Buy OOS Muni Bonds?
Replies: 11
Views: 449

Re: Buy OOS Muni Bonds?

For a given yield-to-worst (YTW) if you are in a state with an income tax, a municipal bond issued from your resident state will have a higher after-tax yield than a similar bond (with the same YTW) issued from another state. From a state taxation perspective, that's the only thing to be aware of. But since you are in a no income-tax state, that need not be a factor. States do not withhold taxes from municipal bond interest.
by Longdog
Mon Mar 25, 2024 6:39 am
Forum: Personal Finance (Not Investing)
Topic: IRA Distributions of US Govt Interest are State Tax Free in WI and OR
Replies: 15
Views: 972

Re: IRA Distributions of US Govt Interest are State Tax Free in WI and OR

Geologist wrote: Sun Mar 24, 2024 9:35 pm
Cocoa Beach Bum wrote: Sun Mar 24, 2024 9:11 pm
WhitePuma wrote: Sun Mar 24, 2024 2:39 pmI’ve recently come to learn that interest/dividends derived from U.S. Govt obligations held within a pre-tax 401k or IRA are exempt from state tax in Wisconsin and Oregon when a distribution is made from the account. This seems like it could be a very valuable tax break for folks in those states.
...
I doubt that ANY distributions from pre-tax 401k or IRA accounts are exempt from any state income tax anywhere.
You are incorrect. Pennsylvania doesn't tax distributions from 401k's or IRA's at all.
Or social security or income from pensions.
by Longdog
Thu Mar 21, 2024 12:58 pm
Forum: Personal Finance (Not Investing)
Topic: Vanguard corrected consolidated 1099
Replies: 5
Views: 494

Re: Vanguard corrected consolidated 1099

I had something similar a year or two ago. The first correction had to do with tax-exempt interest that was either added, subtracted, or changed, and then the subsequent re-correction reverted back to the original. I hesitated filing an amended return to begin with, since it wouldn't have changed my tax obligation. And then, with the second correction, I didn't take any further action, other than to review and determine what had changed. In your case, there's no need to file an amended return since there is no net change.
by Longdog
Tue Mar 19, 2024 7:25 am
Forum: Personal Investments
Topic: Quicken Mavens: some RSU help?
Replies: 7
Views: 613

Re: Quicken Mavens: some RSU help?

I never entered RSUs in Quicken until they vested. They really are worth zero until that point, as you know. Well, sort of. Maybe it’s different in our line of work, but we have never had RSUs get forfeited without a new employer buying us out of them. So, maybe the exchanged shares did better, the same, or worse than the previous shares, but things never went to zero. The RSUs are also a significant amount, equal to more than a year’s income, so it’s nice to “have an idea” of what they’re worth, but not count them explicitly. Hence my 1% valuation of RSUs: math easy enough for me :D That "idea of what they're worth" is often referred to, euphemistically, as "golden handcuffs." :D It's not so much that the inherent valu...
by Longdog
Mon Mar 18, 2024 7:53 pm
Forum: Personal Investments
Topic: Quicken Mavens: some RSU help?
Replies: 7
Views: 613

Re: Quicken Mavens: some RSU help?

I never entered RSUs in Quicken until they vested. They really are worth zero until that point, as you know. When they vesedt, I created "payroll" entries in Quicken, showing Wages (number of RSUs vested x share value), taxes withheld, etc., with the resulting value showing as my net payment in cash in my brokerage account. Then, I created a purchase transaction on the same date, using that cash to purchase the number of shares at the vested share price. This approach accounted for the earnings that got generated, the tax withholdings that occurred, and the acquisition of the new shares of company stock. For the dividends that accumulated, but weren't distributed until the vesting of the RSUs, I generated an entry that was essenti...
by Longdog
Sat Mar 16, 2024 8:35 am
Forum: Personal Finance (Not Investing)
Topic: Fair Equity Percentage for In-Law Reno to Moms House until End of Life
Replies: 8
Views: 790

Re: Fair Equity Percentage for In-Law Reno to Moms House until End of Life

The fact that it's currently in trust, with each sibling having a 1/3 share, complicates the math a bit. 1) You need to get it assessed to determine its current fair market value. 2) From the assessment, you'd determine the dollar amount that each of you has in equity in the house. 3) Add, to your share, the 180K additional you are investing. 4) Add, to the total value of the house, the combined 360K that you and your mother are investing. This will be the new value, after renovations. 5) Divide your current share (the value from step 3) into the new value (from step 4). This should be your percentage ownership after the renovations are made. 6) Take what remains after step 5 (that is, 100% minus the value derived in step 5) and divide it b...
by Longdog
Fri Mar 15, 2024 7:48 am
Forum: Personal Finance (Not Investing)
Topic: Filing a 1040-X - which amount to pay via EFT
Replies: 1
Views: 211

Filing a 1040-X - which amount to pay via EFT

I already filed my 2023 federal taxes, and just received a corrected 1040-INT from Fidelity with additional treasury interest reported. This results in an additional amount due. Using HR Block software, I went through the process to create an amended return. At the final stage, it asks how you want to pay for it, and I indicated EFT, just like I did with the original return. I would have thought that the amount I should enter is the incremental amount due as a result of the amended return, not the total amount due. However, when I enter that amount it presents a warning that I am not paying the total amount due. So, I'm confused whether that number should represent the total amount due, in which case it would overwrite the original amount, ...
by Longdog
Fri Mar 15, 2024 7:05 am
Forum: Personal Finance (Not Investing)
Topic: How much should I leave to nieces/nephews vs. siblings vs. charity I'm passionate about?
Replies: 66
Views: 5587

Re: How much should I leave to nieces/nephews vs. siblings vs. charity I'm passionate about?

Unless siblings have mental or physical limitations that have (or will) restrict their ability to function for the remainder of their life, and unless you had an agreement with them to share the costs of caring for another relative who needs assistance, I don't see the point of leaving assets to siblings. They are your peers, and (with the exceptions noted) had the same opportunities as you did in your lives to earn money. In terms of the "next" generation, and with similar exceptions, I'd say that depends on how close you are to them. If you wished to leave them an inheritance, it should be enough to do something meaningful that they might not have been able to do (yet) at this point in their lives, but not so much as to eliminat...
by Longdog
Wed Mar 13, 2024 11:58 am
Forum: Investing - Theory, News & General
Topic: Is Raymond James beating the SP500? That's what they are claiming.
Replies: 59
Views: 4786

Re: Is Raymond James beating the SP500? That's what they are claiming.

I wonder if this old report subtracted off the annual drain of their Assets Under Management fee, which of course is on top of trading fees, plus perhaps taxes on all of those gains?
by Longdog
Tue Mar 12, 2024 12:15 pm
Forum: Personal Consumer Issues
Topic: Dental upcharges?
Replies: 13
Views: 1445

Re: Dental upcharges?

Presumably you go for a cleaning and a dental exam. Only the dentist can perform the latter. Yes, that is typically how it is done, and how it is charged unless the dentist is the one doing the cleaning, in which case it’s still two different things. This has been my experience my whole life, and I’ve gone to several different dental practices across four states.
by Longdog
Sun Mar 10, 2024 9:40 am
Forum: Personal Investments
Topic: Slice and dice VTI for tax savings: worth the squeeze?
Replies: 17
Views: 1551

Re: Slice and dice VTI for tax savings: worth the squeeze?

Assuming you mean pre-tax when you refer to tax-advantaged, rather than Roth, then realize that not only will you pay taxes on the contributions you eventually withdraw (which of course you got to deduct going in), you'll also pay taxes (at your marginal tax rate) on the growth at the time of withdrawal. Essentially, the entire amount in your pre-tax account should be discounted by your future marginal tax bracket. So, you may want to adjust the amounts accordingly.
by Longdog
Sat Mar 09, 2024 12:18 pm
Forum: Investing - Theory, News & General
Topic: How to Keep Track of Roth IRA Basis for Roth Conversions
Replies: 19
Views: 1229

Re: How to Keep Track of Roth IRA Basis for Roth Conversions

So I'm over 59 1/2 and this year I'd like to do some TIRA to Roth IRA conversions. Usually it's the tIRA basis that you care about, and that usually refers to the amount in a tIRA that you've already paid taxes on. It's not clear to me from what you wrote that you have any funds in the tIRA that you've already paid taxes on...? I haven't paid any taxes on my TIRA which was opened in August 2023 when I did a partial in-service rollover from my 401K. But I was reading if I want to do any Roth Conversions that I will be asked my Roth IRA basis on my taxes. https://www.thebalancemoney.com/what-is-a-roth-ira-basis-5224309 "You're required to fill out IRS Form 8606 in the years you make a Roth IRA distribution or Roth conversion. Line 22 of...
by Longdog
Fri Mar 08, 2024 7:37 pm
Forum: Investing - Theory, News & General
Topic: Taxation of Treasury bills, notes and bonds
Replies: 1077
Views: 157100

Re: Report Gain from Selling T-Bill as Interest Income?

I read many threads about this kind of discussion and feel even more confused when I read more. As far as I know, brokers are not required to report the cost basis of selling T-bills (anyone can provide the source of IRS?), so how to report this gain becomes a grey area which causes a lot of controversy and confusion. In my case, all the gains from selling T-bills are reported in 1099-INT as Interest Income. According to popular opinions, I should divide this amount into capital gain and interest income by myself and adjust my 1099-B and 1099-INT accordingly. However, in Department of the Treasury's FS Publication 0011 (can be found here: https://www.treasurydirect.gov/marketable-securities/forms/), it says "Treasury bills are short-t...
by Longdog
Fri Mar 08, 2024 2:50 pm
Forum: Investing - Theory, News & General
Topic: How to Keep Track of Roth IRA Basis for Roth Conversions
Replies: 19
Views: 1229

Re: How to Keep Track of Roth IRA Basis for Roth Conversions

If you are doing TIRA to Roth IRA conversions, you need to know about any non-deductible contributions to your TIRA. These would be tracked on form 8606. Did you ever contribute to your traditional IRA and not deduct the amount contributed from your taxable income? If not, then you don't need to worry about any basis if all you are doing is a conversion from traditional to Roth IRA.
by Longdog
Thu Mar 07, 2024 7:41 pm
Forum: Personal Finance (Not Investing)
Topic: Has Anyone Had This Scenario/Situation With The IRS
Replies: 21
Views: 3057

Re: Has Anyone Had This Scenario/Situation With The IRS

Many years ago, before electronic payments were customary, I received a letter from the IRS saying I owed them the exact amount of the check I paid them with. I found the canceled check, and sent a copy of it in response. After a suitable amount of time not hearing back from them, I called them and they were able to "locate" the check, or at least track where it was credited. It was apparently credited to the wrong account - they fat-fingered the SSN on the check, swapping two digits. Everything cleared up at that point.
by Longdog
Tue Mar 05, 2024 8:47 pm
Forum: Personal Investments
Topic: Vanguard applied RMD to the wrong year?
Replies: 11
Views: 1393

Re: Vanguard applied RMD to the wrong year?

ancho wrote: Tue Mar 05, 2024 10:26 am
BigPrince wrote: Mon Mar 04, 2024 8:55 pm What was the purpose of waiting this long and missing your RMD?
There were various reasons though I’m not sure how that’s helpful in answering my question.
Well one of your questions was “ Did I screw this up or did Vanguard?” so it could help answer that. To that I’d say you might not have explicitly screwed up, but you took a risk cutting it so close to the end of the year. And due to settlement times, it’s not unreasonable for Vanguard to handle and report it as they did.
by Longdog
Mon Mar 04, 2024 7:49 pm
Forum: Personal Investments
Topic: 2024 Backdoor Roth conversion?
Replies: 6
Views: 771

Re: 2024 Backdoor Roth conversion?

MCDood wrote: Mon Mar 04, 2024 6:55 pm Can I convert traditional IRA monies, from other non-Fidelity IRA accounts, to backdoor (I think this is what I am trying to do) Roth $$$$ during calendar year 2024 while in my (more than likely) last year of work, whilst continuing with my current contribution plan?

Thank you!

Ken
Converting existing traditional IRA balances to a Roth IRA is always allowed, but is not what is referred to as a "backdoor contribution to a Roth IRA." In that case, assuming all of the IRA balance was pre-tax, then the total amount will be added to your taxable income and you will owe taxes on it at your marginal tax rate. If you are in a high tax bracket because you are still working, this might not be a good year to do such a conversion.
by Longdog
Mon Mar 04, 2024 7:24 pm
Forum: Personal Investments
Topic: close to retiring - what to do with company 401k
Replies: 13
Views: 1649

Re: close to retiring - what to do with company 401k

It's not a one-size fits all decision, and several factors should be considered. Such as: 1) How old will you be when you retire? If you're under 59.5 you may have penalty free withdrawal options available to you if it's in the 401k that would not be available if it's rolled over to an IRA. 2) What are the investment options in the 401k? If you have excellent, institutional funds, or unique funds with extraordinarily low expense ratios, that might be better than what you could get as a retail client in an IRA. 3) What are the expenses associated with the 401k? If they are high, then yes you should probably roll over to an IRA, and the other questions, especially number 2, would not matter as much. 4) Can you take partial withdrawals from yo...
by Longdog
Mon Mar 04, 2024 12:35 pm
Forum: Personal Investments
Topic: Estimating dividends/interest in retirement planning
Replies: 7
Views: 777

Re: Estimating dividends/interest in retirement planning

If there are no changes (eg., reinvestments, new purchases, or sales) in dividend paying investments, I estimate this year's dividends will be approximately the same as last years dividends. If anything was reinvested last year, or if shares were purchased (or sold), I scale up (or down) the estimate by the ratio of this year's shares to last year's shares.
by Longdog
Sun Mar 03, 2024 8:02 am
Forum: Personal Finance (Not Investing)
Topic: Not understanding taxes and why I owe money
Replies: 50
Views: 4914

Re: Not understanding taxes and why I owe money

Do you mean that withholding from your paycheck wasn’t enough to cover your tax liability, so you have an amount due with your tax return; or that your total tax liability is $1100?
by Longdog
Fri Mar 01, 2024 4:24 am
Forum: Personal Investments
Topic: I want to pay off car using money from Roth IRA
Replies: 40
Views: 4638

Re: Do I take out a 7.44% car loan or do I dip into my Roth?

What percentage of the six figure income would the monthly car loan payments be? Is there some reason you couldn’t pay the car loan from the earned income, and perhaps even accelerate the payments so it is paid off in a year or two? The loan rate is high, but if you can pay it off in a relatively short period of time the impact would be mitigated. In the long term Roth is valuable space so if you can avoid using it, and allow it to continue to grow tax-free in the Roth for many years, you’d likely be better off (though no guarantees).
by Longdog
Thu Feb 29, 2024 8:11 pm
Forum: Personal Investments
Topic: Mega Backdoor Roth at Fidelity - general questions + no automatic option
Replies: 3
Views: 519

Re: Mega Backdoor Roth at Fidelity - general questions + no automatic option

I decided to start doing Mega Backdoor Roth this year (I’m already maxing employee portion of 401k, HSA and Backdoor Roth IRA). I called Fidelity and confirmed that my 401k plan allows after-tax contributions, as well as both in-service after tax withdrawal and in-Plan Roth Rollover. The only thing that’s missing is automated withdrawals/rollovers, so it looks like I will have to call in every paycheck. I guess I doesn’t have to be done every paycheck, but then my understanding is I’d have to pay ordinary income tax on potential earnings. I haven’t decided if I should move money to my Roth IRA or keep it within the plan by rolling over to Roth IRA. If I move it to Roth IRA my plan was to buy FZROX, and if I leave it at 401k then I’d be buy...
by Longdog
Thu Feb 29, 2024 9:06 am
Forum: Personal Finance (Not Investing)
Topic: Leaving IRA to DAF (donor advised fund) on death, a sanity check
Replies: 45
Views: 3700

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

rkhusky wrote: Thu Feb 29, 2024 8:35 am I don’t think IRA’s can go directly to a DAF. QCD’s are the usual mechanisms for donating directly out of an IRA.
Do you have a source for that? If not, why do you think that is true? QCDs are only useful when you're alive.
by Longdog
Mon Feb 26, 2024 8:48 am
Forum: Personal Investments
Topic: Vanguard account in brother's estate
Replies: 22
Views: 2580

Re: Vanguard account in brother's estate

Thank you everyone... The little bits of information I have so far are all from the executor, who is my sister. She's not an investment expert (and I'm not either), so I don't know how much she understands of the situation. I'm hoping there aren't any named beneficiaries on the IRA. Otherwise the estate won't really have anything in it, would it? I'm supposed to be inheriting a quarter of the estate, excluding the house. I don't have the death certificate. Any way to get a copy (I'm in Ohio) without paying for a certified copy? First of all, I'm very sorry for your loss. If your brother set up the beneficiary designation on the IRA such that you get 25% of it, there would be no material difference once things settle out. Personally, all ot...
by Longdog
Sat Feb 24, 2024 6:49 pm
Forum: Personal Finance (Not Investing)
Topic: H&R Block Tax Software and Box 10 of Form 8606
Replies: 2
Views: 455

Re: H&R Block Tax Software and Box 10 of Form 8606

I had a very similar situation. Once I determined it was just a rounding issue, I gave it no further thought. When you realize how insignificant the tax would be on $2 I think you’ll reach the same conclusion. There were other parts of the return where the rounding went the other way.
by Longdog
Sat Feb 24, 2024 9:33 am
Forum: Personal Finance (Not Investing)
Topic: Consulting 1099 and social security credits
Replies: 20
Views: 1456

Re: Consulting 1099 and social security credits

Depending on your annual salary during your W2 years, you might find that your average indexed monthly earnings have already taken you above what is referred to as the second bend point, in terms of calculating your future social security benefits. If that is the case, then it is unlikely that 15-20K additional per year is going to cause much of an increase in your future social security benefits. It will have some benefit, but it could be tiny. If you haven't already, you might want to familiarize yourself with bend points to determine where you currently stand. I'm not suggesting you shouldn't get a 1099 gig, but if your goal for doing so is to significantly boost your PIA, you should get a sense for how big an impact it will have.
by Longdog
Sat Feb 24, 2024 7:55 am
Forum: Personal Investments
Topic: Roth to traditional IRA recharacterization - is it not allowed?
Replies: 7
Views: 1275

Re: Roth to traditional IRA recharacterization - is it not allowed?

A Roth conversion is very different than a recharacterization. A conversion changes any amount of pre-tax money (say, in a Traditional IRA) to post-tax (in a Roth IRA) and you pay taxes on the amount of the conversion. These can no longer be un-done. Minor correction: it doesn't need to be pre-tax money. It can be after-tax (non-deductible) money in a traditional IRA. The concept of the frequently discussed "backdoor Roth IRA contribution" is to make a non-deductible contribution to a traditional IRA, then to quickly convert it to a Roth IRA. I don't recommend recharacterizing to an IRA if you will be withdrawing in the future while living in another country. A "recharacterization" fixes that original contribution to be...
by Longdog
Thu Feb 22, 2024 7:16 am
Forum: Investing - Theory, News & General
Topic: Vanguard Digital Advisor has "A proven track record with active"
Replies: 16
Views: 2378

Re: Vanguard Digital Advisor has "A proven track record with active"

What is the time frame of the "proven record"? If Digital Advisors options are changing, why should we expect out performance in the past to continue into the future? Digital Advisers are relatively new products. I suspect the algorithms are often tweaked and maybe overhauled on occasion. Maybe even working toward adding AI! I am doubtful of an assertion such a product has a "proven record". Further, if you really want to parse it literally, what is even meant by "a proven record" in any context? It doesn't say what it is proven to be. It could be proven to match market returns consistently over a period of time. It could be proven to do consistently worse than the market returns over a period of time. Both co...
by Longdog
Wed Feb 21, 2024 9:53 am
Forum: Personal Investments
Topic: Any way to Roth?
Replies: 15
Views: 1958

Re: Any way to Roth?

RetiredAt61 wrote: Wed Feb 21, 2024 9:29 am Are we missing something? $180,000 in a Roth doesn't seem like much help.
Depends who you are trying to help and/or what you trying to achieve. What are your reasons for considering it?
by Longdog
Wed Feb 21, 2024 8:26 am
Forum: Investing - Theory, News & General
Topic: Agency Bonds, any reason to avoid?
Replies: 16
Views: 1324

Re: Agency Bonds, any reason to avoid?

Are Agency Bonds guaranteed by the "full faith and credit of the United States of America" like Treasuries or do they have a lesser guarantee? Does their payback need to be appropriated annually?
by Longdog
Mon Feb 19, 2024 8:30 am
Forum: Personal Investments
Topic: Confused about Vanguard settlement fund.
Replies: 34
Views: 3693

Re: Confused about Vanguard settlement fund.

ROTH conversions essentially are a form of tax arbitrage. As you're aware, you lose much, but not necessarily all, of the arbitrage benefit if you have to deduct the taxes from the conversion amount. (I think you might soften this disadvantage by doing the conversion without any tax withholding so the full amount moves to your ROTH and then separately taking a withdrawal from your tIRA that gives you sufficient funds to make a timely tax payment .) Whether a conversion still makes sense for you depends on your individual circumstances, and on what you think your future tax bracket and tax rate will be. For example, if the tcja provisions are not extended beyond 2025, many people will end up in lower brackets with higher rates. If this is y...
by Longdog
Mon Feb 19, 2024 6:20 am
Forum: Investing - Theory, News & General
Topic: How to Plan for Health Expenses With Retirement Far Away?
Replies: 17
Views: 1603

Re: How to Plan for Health Expenses With Retirement Far Away?

As an individual, you can’t know with any degree of certainty what your future health expenses are going to be. You could (and hopefully will) be lucky your whole life and have very few health issues, but the opposite could also happen. If you feel the need to single out healthcare savings in your planning and you’re a conservative investor, use the worst case projection. I think, though, that the best approach overall is to save and invest as much as you can in appropriate investment vehicles - selecting a healthy percentage of your earnings and trying to increase that percentage over time. And know that by doing so you will be better than most in your preparation for retirement.
by Longdog
Sun Feb 18, 2024 3:43 pm
Forum: Personal Finance (Not Investing)
Topic: Protecting Assets Nursing Home Care
Replies: 64
Views: 9525

Re: Protecting Assets Nursing Home Care

So sorry for your loss.
by Longdog
Sun Feb 18, 2024 2:05 pm
Forum: Personal Investments
Topic: Confused about Vanguard settlement fund.
Replies: 34
Views: 3693

Re: Confused about Vanguard settlement fund.

I think the problem is on the traditional IRA brokerage side, not the Roth side. You may need to liquidate securities and have that money settled in the traditional IRA brokerage account, before converting to a Roth account. On the mutual fund platform, there was more flexibility in what you could convert from and to. On the brokerage platform, that doesn't seem to be the case - at least not online. Everything flows through settlement accounts. Maybe if you called there would be more options available.
by Longdog
Fri Feb 16, 2024 7:27 pm
Forum: Personal Finance (Not Investing)
Topic: Social Security -- What’s in Your Retirement Plan?
Replies: 47
Views: 3683

Re: Social Security -- What’s in Your Retirement Plan?

If your question is about ability to pay out promised benefits in the next ~10 years, I assume I will get about 75% of what my projection is, at whatever age I start collecting. So I plan to delay until 70, because regardless of what the reduction may be, waiting till 70 will still give me the maximum benefit, and it will be inflation adjusted for the remainder of my life.
by Longdog
Fri Feb 16, 2024 3:49 pm
Forum: Personal Finance (Not Investing)
Topic: Sign up for two ACA plans
Replies: 31
Views: 2375

Re: Sign up for two ACA plans

Wouldn’t it be cheaper to get a PPO then go out of network and still get some coverage?
by Longdog
Wed Feb 14, 2024 5:09 pm
Forum: Personal Finance (Not Investing)
Topic: First time owing federal taxes
Replies: 45
Views: 4461

Re: First time owing federal taxes

One strategy is to wait near the end of the year to estimate how much extra you want withheld. Then file a W-4 that adjust the withholding for your next paycheck by just that amount. Afterwards, immediately file another W-4 to change it back to your usual amount. You’ll need to talk to your payroll department about the timing required for each W-4. For a small amount it is probably not worth the hassle, but I did this once to put myself in the “safe harbor” range one year when I had a large unexpected windfall near the end of the year. What possible benefit would that have over simply making an estimated payment in mid January through https://www.eftps.gov? Because taxes withheld, regardless when that withholding occurs in the year, are al...
by Longdog
Wed Feb 14, 2024 12:55 pm
Forum: Personal Finance (Not Investing)
Topic: FSA when leaving job
Replies: 14
Views: 1428

Re: FSA when leaving job

Keep in mind that while you can continue to contribute during a COBRA continuation period, it won't be tax deductible.
by Longdog
Wed Feb 14, 2024 12:41 pm
Forum: Personal Finance (Not Investing)
Topic: Fidelity Credit Card Late Fee
Replies: 16
Views: 1856

Re: Fidelity Credit Card Late Fee

I missed making my Fidelity Payment Super Bowl Sunday. My fault, I had a reminder set, but when it popped up on my phone I dismissed it and said I'll do it after the game, and then forgot. I pay both mine and my wife's first thing the next morning. I asked for Late Fee reversal and admitted it was my fault. Reps said sure. When I logged in last night to check if they had been reversed, there was a $30 Late fee and a $30 credit on mine, and a $40 late fee and a $30 credit on my wife's. I'm sure they will fix it, but has anyone else seen a $40 late fee? I don't understand why hers was more than mine. I guess hers had a couple grand more balance. Or was it because she is a woman ? LOL Definitely because of that. It's in the fine print of thei...
by Longdog
Wed Feb 14, 2024 11:04 am
Forum: Personal Investments
Topic: Taxes- how to document tax exempt interest
Replies: 11
Views: 1417

Re: Taxes- how to document tax exempt interest

retiringwhen wrote: Tue Feb 13, 2024 10:01 pm
Tracker968 wrote: Tue Feb 13, 2024 9:49 pm
And has anyone seen the Fidelity tax exempt % list yet? Maybe I'm not looking on the right place for it.
This is the official place, it ain't out yet.

https://www.fidelity.com/tax-informatio ... nformation
It is now available.
by Longdog
Tue Feb 13, 2024 11:03 am
Forum: Personal Investments
Topic: Did backdoor Roth. How does this impact taxes for a 401(k) to traditional IRA rollover?
Replies: 29
Views: 1785

Re: Did backdoor Roth. How does this impact taxes for a 401(k) to traditional IRA rollover?

So I early-retired last year at the age of 55 and I have to take a distribution from my 401K for a wedding. The 401k plan structure that my company has with Fidelity allows only a lump-sum distribution. They proposed that I move my Trad 401k into my Trad IRA. However, I already completed the Backdoor Roth. If I move the 401k money into my Trad IRA, then the pro-rata rule applies (I am still not quite clear on what I will need to pay a tax on with the pro-rata rule). If you cannot simply withdraw the amount needed from the 401k, you’ll be creating an extra tax and penalty burden on yourself in multiple ways. First, the amount withdrawn from the IRA will be subject to both regular income taxation plus a 10% penalty for early withdrawal. Seco...
by Longdog
Sun Feb 11, 2024 9:35 pm
Forum: Investing - Theory, News & General
Topic: Why can't you trade in real time?
Replies: 17
Views: 1980

Re: Why can't you trade in real time?

What security are you attempting to trade?
by Longdog
Sat Feb 10, 2024 6:12 pm
Forum: Personal Finance (Not Investing)
Topic: traditional IRA and Roth IRA question
Replies: 22
Views: 2362

Re: traditional IRA and Roth IRA question

mymoney2022 wrote: Fri Jan 26, 2024 3:48 pm Hi, I currently have one traditional IRA and one Roth IRA.
What was the value of your traditional IRA prior to the contribution? Seems like everyone was assuming it contained no pre-tax contributions from prior years. Is that the case?
by Longdog
Sat Feb 10, 2024 6:02 pm
Forum: Personal Finance (Not Investing)
Topic: Use HSA Proceeds to Make Solo 401(k) Contribution
Replies: 19
Views: 1354

Re: Use HSA Proceeds to Make Solo 401(k) Contribution

Okay, so to understand why this is mathematically beneficial, it's worthwhile to point out that the $1000 of funds going into the 401k actually come from two places: $750 from the HSA and $250 from the tax savings at a marginal tax bracket of 25%. It's not just a lateral movement that shifts $1000 from tax-free HSA space to tax-deferred 401k space. It's a shift of $750 from tax-free HSA space to tax-deferred 401k space, plus the tax-savings of an additional $250 that gets tax-deferred treatment. This seems like the best way to explain it, or to use the original numbers, $1,000 from HSA and $333 in tax savings. Those numbers might make it more clean when talking about HSA -> Roth vs HSA -> traditional. I knew the main benefit stemmed from g...
by Longdog
Thu Feb 08, 2024 7:55 pm
Forum: Personal Finance (Not Investing)
Topic: Use HSA Proceeds to Make Solo 401(k) Contribution
Replies: 19
Views: 1354

Re: Use HSA Proceeds to Make Solo 401(k) Contribution

I just read that thread. In your example (which I know comes from the thread), it seems to suggest incurring a $1000 medical expense, getting reimbursed for it from the HSA, contributing $1333 to the 401k and taking the $1333 deduction from taxes (netting a tax savings of $333 at 25%). Is that really what the OP was considering? Maybe I was mistaken, but I interpreted the original question as effectively shifting $1000 from the HSA to the 401k, not adding in the extra tax savings. If that is the case, are we now comparing the value of $1000 in an HSA versus $1333 in a 401k? Maybe that's not OP's original intention, but if you look at the steps OP would have to take: 1) They would contribute an extra $1,000 to the 401(k) 2) Their paycheck w...
by Longdog
Thu Feb 08, 2024 1:56 pm
Forum: Personal Finance (Not Investing)
Topic: Use HSA Proceeds to Make Solo 401(k) Contribution
Replies: 19
Views: 1354

Re: Use HSA Proceeds to Make Solo 401(k) Contribution

If the OP is able to pay current expenses out of pocket, they probably should do so, and save receipts for future reimbursement. And then invest the HSA as if it were a Roth account for maximum growth and eventual tax-free withdrawal from the HSA. The cases where that approach would not be beneficial would be if they are unable to pay current expenses out of pocket or if they do not incur sufficient medical expenses over time that meet or exceed the future value of the HSA prior to their death. In the latter of those two cases, they are no worse off than if they moved the money to the 401k, and possibly better if they live long enough to be able to incur medical expenses that would eventually pull all the money from the HSA tax free. I'm n...
by Longdog
Thu Feb 08, 2024 12:11 pm
Forum: Personal Finance (Not Investing)
Topic: Use HSA Proceeds to Make Solo 401(k) Contribution
Replies: 19
Views: 1354

Re: Use HSA Proceeds to Make Solo 401(k) Contribution

OP is giving up the benefit of future tax-free growth if it stays in the HSA, for the benefit of a current year tax deduction that will eventually be negated (or, or if not negated then at least reduced) by paying taxes on its future withdrawal on the amount plus its growth. Seems like a bad tradeoff to me. The Wiki probably explains it better than I could: Paying current expenses from the HSA If you are not maxing out your retirement accounts, you should usually pay current expenses from the HSA.[18] If you are in a 25% tax bracket and have $1,000 in medical bills, taking $1,000 from the HSA, and taking advantage of the fact that this wasn't an out-of-pocket expense so that you can invest an extra $1,000 in your Roth IRA or $1,333 in your...