Search found 13342 matches

by Spirit Rider
Fri Sep 18, 2020 1:35 pm
Forum: Personal Investments
Topic: Are employer contributions/matches to Solo Roth 401(k) deductible?
Replies: 7
Views: 238

Re: Are employer contributions/matches to Solo Roth 401(k) deductible?

Okay that makes more sense, thanks. So, in theory, I'd be able to contribute up to an additional $37,500 of pre-tax employer matches* ? In addition to the absolute limit, you are limited to 25% of earnings/compensation, but yes, your math is right regarding the absolute limits. So there isn't any m...
by Spirit Rider
Tue Sep 15, 2020 9:16 pm
Forum: Personal Consumer Issues
Topic: PSA: switch to LED light bulbs and save hundreds per year
Replies: 165
Views: 10631

Re: PSA: switch to LED light bulbs and save hundreds per year

There are many people who always turn on the lights even on a sunny day with lots of windows in the room.
by Spirit Rider
Tue Sep 15, 2020 9:10 pm
Forum: Personal Investments
Topic: Hiring my first employee, so will have to lose my Solo 401(k). What to do now?
Replies: 13
Views: 1508

Re: Hiring my first employee, so will have to lose my Solo 401(k). What to do now?

*With the passage of the SECURE ACT effective on 1/1/2021, employees with >= 500 hours/year of service for >= three years are eligible. However, the counting of the years doesn't begin until 1/1/2021. Therefore, the earliest such employees become eligible is 1/1/2024. Spirit Rider, With the passage...
by Spirit Rider
Tue Sep 15, 2020 7:57 am
Forum: Personal Finance (Not Investing)
Topic: Basic Solo 401k to get more $ into Roth
Replies: 11
Views: 810

Re: Basic Solo 401k to get more $ into Roth

Pre-tax balances in all traditional, SEP and SIMPLE IRA accounts cause pro rata taxation with the Backdoor Roth. However, they have no effect on direct rollovers from a one-participant 401k to a Roth IRA to implement the MBR. A one-participant 401k @E-Trade allows the election and use of their in-pl...
by Spirit Rider
Tue Sep 15, 2020 7:05 am
Forum: Personal Investments
Topic: Roth Ira and ROth Solo 401k
Replies: 18
Views: 918

Re: Roth Ira and ROth Solo 401k

Self-employed one-participant 401k contributions are based on net earnings from self-employment (earned income) = business profit - SE tax. DOes the solo 401k or roth solo 401k contribution from self employment has to be 1099 income? I already explicitly answered this above and @David Jay also did ...
by Spirit Rider
Mon Sep 14, 2020 8:48 pm
Forum: Personal Investments
Topic: Roth Ira and ROth Solo 401k
Replies: 18
Views: 918

Re: Roth Ira and ROth Solo 401k

As I said above, only 1099 income can be used to qualify for Solo 401K and only 50% of your net self employment profit (revenue minus expenses). I'm not sure where this 50% total limit is coming from. Self-employed one-participant 401k contributions are based on net earnings from self-employment (e...
by Spirit Rider
Mon Sep 14, 2020 7:39 pm
Forum: Personal Investments
Topic: Hiring my first employee, so will have to lose my Solo 401(k). What to do now?
Replies: 13
Views: 1508

Re: Hiring my first employee, so will have to lose my Solo 401(k). What to do now?

As pointed out by clarkdfw, a SIMPLE IRA is a good low cost option. Yes, the employee deferral and employer contribution limits are lower, but Fidelity and some others have no administrative fees. Your other option is a safe harbor 401k plan. it will have setup and annual administrative fees in the ...
by Spirit Rider
Mon Sep 14, 2020 7:25 pm
Forum: Personal Investments
Topic: Roadmap for Mega Backdoor Roth-Enabled Solo 401(k) Without TPA
Replies: 11
Views: 607

Re: Roadmap for Mega Backdoor Roth-Enabled Solo 401(k) Without TPA

So either Ascensus changed its plan documentation in a way that impedes executing MBR or I spoke to someone who gave me incorrect info (or I am looking at the wrong Ascensus product). I have no direct knowledge either way. Although, in recent years forum members have reported being able to add an e...
by Spirit Rider
Mon Sep 14, 2020 7:12 pm
Forum: Personal Investments
Topic: Roadmap for Mega Backdoor Roth-Enabled Solo 401(k) Without TPA
Replies: 11
Views: 607

Re: Roadmap for Mega Backdoor Roth-Enabled Solo 401(k) Without TPA

5. There is no election requirement for employee after-tax contributions. This is only a requirement for employee elective deferrals. What does this mean? The only "elective" contributions are employee deferrals. You are only required to make an "election" for employee deferrals. Therefore, you can...
by Spirit Rider
Mon Sep 14, 2020 8:01 am
Forum: Personal Investments
Topic: Roadmap for Mega Backdoor Roth-Enabled Solo 401(k) Without TPA
Replies: 11
Views: 607

Re: Roadmap for Mega Backdoor Roth-Enabled Solo 401(k) Without TPA

I am probably the one with the strongest caution against DIY MBR. My reasoning being that the vast majority of posters have demonstrated a lack of even a basic understanding of the limited self-administration requirements of a prototype one-participant 401k. I am impressed by your well researched an...
by Spirit Rider
Sat Sep 12, 2020 10:48 pm
Forum: Personal Finance (Not Investing)
Topic: What does Medicare A do, if one is still working with health coverage?
Replies: 19
Views: 1049

Re: What does Medicare A do, if one is still working with health coverage?

The two most likely scenarios of Part A paying are where Medicare is primary secondary (>= 20 employees), you are hospitalized and you have: an unmet deductible > the Medicare Part A deductible (2020 = $1408). a co-insurance < 80%. Medicare covered charges are about 80% of average private covered c...
by Spirit Rider
Sat Sep 12, 2020 10:44 pm
Forum: Personal Finance (Not Investing)
Topic: Tax deductions for (temporarily?) discontinued sole proprietorship activity
Replies: 10
Views: 499

Re: Tax deductions for (temporarily?) discontinued sole proprietorship activity

https://turbotax.intuit.com/tax-tips/home-ownership/deducting-health-insurance-premiums-if-youre-self-employed/L6bRhLaVE Clear as mud - for the self employed health insurance deduction, you can only deduct up to your business income. FWIW You are responsible for certifying that the stuff TurboTax s...
by Spirit Rider
Sat Sep 12, 2020 10:35 pm
Forum: Personal Consumer Issues
Topic: Teen Driver Addition to Insurance
Replies: 27
Views: 1875

Re: Teen Driver Addition to Insurance

Isn't it true that the longer one has the license, the lower the insurance rate? Suppose John goes to college in 2024 and needs a car. Isn't it better for him to have his license acquired in 2020 rather than 2024? I'm just guessing here and hope someone can chime on this. This is correct. My stepda...
by Spirit Rider
Sat Sep 12, 2020 10:21 pm
Forum: Personal Finance (Not Investing)
Topic: Remote Job - Taxes
Replies: 31
Views: 2996

Re: Remote Job - Taxes

My understanding of the MA rule is that if it is state B they expect to get paid. I forgot about the MA special provision. Only there is no move required. For example, you live in NH which has no income tax and work in MA. Pre-pandemic you were taxed in MA, because that is where you are deriving th...
by Spirit Rider
Sat Sep 12, 2020 10:09 pm
Forum: Personal Finance (Not Investing)
Topic: What does Medicare A do, if one is still working with health coverage?
Replies: 19
Views: 1049

Re: What does Medicare A do, if one is still working with health coverage?

The two most likely scenarios of Part A paying are where Medicare is primary (>= 20 employees), you are hospitalized and you have:
  • an unmet deductible > the Medicare Part A deductible (2020 = $1408).
  • a co-insurance < 80%. Medicare covered charges are about 80% of average private covered charges.
by Spirit Rider
Sat Sep 12, 2020 9:50 pm
Forum: Personal Finance (Not Investing)
Topic: Remote Job - Taxes
Replies: 31
Views: 2996

Re: Remote Job - Taxes

Tx.. but help me understand Assume employer has headquarters in state A, offices in state B, you used to work in state B and then you move to state C and telecommute from there (no employer presence in state C). In which state do employer convenience rules apply, A or B? A, but only if state A is o...
by Spirit Rider
Sat Sep 12, 2020 9:46 pm
Forum: Personal Investments
Topic: Hiring my first employee, so will have to lose my Solo 401(k). What to do now?
Replies: 13
Views: 1508

Re: Hiring my first employee, so will have to lose my Solo 401(k). What to do now?

If your one-participant 401k is at a provider other than Vanguard, you can elect employee eligibility restrictions. These restrictions can include up to age 21 and a minimum of one year of service >= 1,000* hours. This is elected in the adoption agreement. If you didn't elect at adoption, you can fi...
by Spirit Rider
Fri Sep 11, 2020 11:35 pm
Forum: Personal Finance (Not Investing)
Topic: Remote Job - Taxes
Replies: 31
Views: 2996

Re: Remote Job - Taxes

How do they differentiate between someone telecommuting to one of these states to someone who works alone in another state? It is called the; "convenience of the employer" rule. If you must be located in that state, because you are servicing customers in that state. E.g. you are a field service eng...
by Spirit Rider
Fri Sep 11, 2020 12:12 am
Forum: Personal Consumer Issues
Topic: Teen Driver Addition to Insurance
Replies: 27
Views: 1875

Re: Teen Driver Addition to Insurance

The cost to self-insure liability is million$. Not a good idea.
by Spirit Rider
Thu Sep 10, 2020 11:59 pm
Forum: Personal Finance (Not Investing)
Topic: Remote Job - Taxes
Replies: 31
Views: 2996

Re: Remote Job - Taxes

IF you counted as working in state X you would have been withhold taxes in state X. My guess is that you counted to be working in MA counting to work on a given state I guess is the tricky part, but it should be specified in your contract Did you not read my post? It is not tricky at all. If the co...
by Spirit Rider
Thu Sep 10, 2020 11:49 pm
Forum: Personal Finance (Not Investing)
Topic: What does Medicare A do, if one is still working with health coverage?
Replies: 19
Views: 1049

Re: What does Medicare A do, if one is still working with health coverage?

Medicare is only primary if your employer has < 20 employees, otherwise Medicare is secondary. This means if you enroll in Medicare Part A and you have an employer policy that has co-pays and/or co-insurance >= 80%, you are unlikely to see Medicare Part A pay anything. It is especially a bad idea to...
by Spirit Rider
Thu Sep 10, 2020 7:01 am
Forum: Personal Finance (Not Investing)
Topic: Remote Job - Taxes
Replies: 31
Views: 2996

Re: Remote Job - Taxes

Prior to COVID-19, only AR, CT , DE, NE, NY and PA had a "convenience of the employer rule." . MA implemented a COVID-19 emergency order for people employed in the state prior to COVID-19 and switching to telecommuting. It is based on the headquarters of the employer. Telecommuters for employer's he...
by Spirit Rider
Wed Sep 09, 2020 9:42 pm
Forum: Personal Investments
Topic: HCE/mega backdoor Roth risk?
Replies: 20
Views: 3007

Re: HCE/mega backdoor Roth risk?

userwithconcern wrote: Wed Sep 09, 2020 9:34 pm Spirit Rider, is this kind of possible return of aftertax contributions a concern even if I am not an HCE?
No, an ACP test failure of employee after-tax contributions could only result in the return of HCE excess contributions.
by Spirit Rider
Tue Sep 08, 2020 8:38 pm
Forum: Personal Investments
Topic: ETrade: How do I perform a I401k Roth rollover
Replies: 5
Views: 290

Re: ETrade: How do I perform a I401k Roth rollover

I have recently amended my i401k plan to ETrade and have added a Roth i401k and in service Roth rollover capabilities. Am I able to request a IRR online or will I need to call? Am I only able to roll to my Roth i401k or can i roll it into my Roth IRA at ETrade? IRR is an in- plan Roth Rollover. Thi...
by Spirit Rider
Tue Sep 08, 2020 8:26 am
Forum: Personal Investments
Topic: Solo 401K for 2 Businesses - LLCs taxed as S?
Replies: 2
Views: 223

Re: Solo 401K for 2 Businesses - LLCs taxed as S?

These two businesses are what is known as a control group. They are considered one employer for retirement plan purposes. If you have an Ascensus based one-participant 401k document/adoption agreement (E-Trade, Schwab, TD Ameritrade and Vanguard), the two businesses are automatically considered affi...
by Spirit Rider
Mon Sep 07, 2020 9:23 pm
Forum: Personal Consumer Issues
Topic: Babysitter tax/payment question
Replies: 2
Views: 406

Re: Babysitter tax/payment question

See IRS Publication 926. All of this is explained. See Table 1 on page 5. A household employer must pay/deduct FICA (Social Security and Medicare taxes) if the babysitter/nanny is paid >= $2,200/year and must pay federal/state unemployment insurance if the babysitter nanny is paid >= $1,000/quarter....
by Spirit Rider
Sat Sep 05, 2020 9:03 pm
Forum: Personal Finance (Not Investing)
Topic: 529/FAFSA Questions
Replies: 4
Views: 438

Re: 529/FAFSA Questions

Keep in mind that third party (including grandparents) 529 accounts are not considered student assets for FAFSA. However, distributions are considered untaxed income to the student and up to 50% is assessed against the expected family contribution (EFC). In other words, distributions from third part...
by Spirit Rider
Sat Sep 05, 2020 8:35 pm
Forum: Personal Investments
Topic: Young Family - 7 Figure Inheritance
Replies: 15
Views: 2642

Re: Young Family - 7 Figure Inheritance

To be clear, unless you were written into the will, your wife inherited the money. Has she made it clear that she wants it to be treated as your joint property? For my personal education...isn’t it automatically joint since they are married? Enlighten me please. Exactly the opposite. Generally, an ...
by Spirit Rider
Sat Sep 05, 2020 3:33 am
Forum: Personal Investments
Topic: Worth the hassle to open an HSA in California?
Replies: 47
Views: 5137

Re: Worth the hassle to open an HSA in California?

As for the information, it really irks me that our HSA bank opened an office on Megacorp campus, but they still don't actually summarize this information for us on the year end statement As big as California is, they still represent a small fraction of HSA Bank's or any other nationwide HSA custodi...
by Spirit Rider
Fri Sep 04, 2020 8:41 pm
Forum: Personal Investments
Topic: Mixed Pre/Post Tax Trad IRA to Solo 401K rollover
Replies: 1
Views: 148

Re: Mixed Pre/Post Tax Trad IRA to Solo 401K rollover

You are envisioning this as more difficult than it really is. The only thing you need to do to calculate your total traditional, SEP and SIMPLE IRA pre-tax balances is subtract your non-deductible basis ($6000) from the total balances from all such accounts. The result is your pre-tax balance. It do...
by Spirit Rider
Wed Sep 02, 2020 10:26 pm
Forum: Personal Finance (Not Investing)
Topic: ‘Play money’ invested by Dad growing huge - what would you do?
Replies: 99
Views: 13088

Re: ‘Play money’ invested by Dad growing huge - what would you do?

I thought UTMA accounts were designed to transfer to the recipient at age of majority -- either 18 or 21 depending on the state. I'm surprised your dad still has any control. All the articles I've seen explicitly say, "At the age of majority, the custodian loses all control." In brief ... you're a ...
by Spirit Rider
Wed Sep 02, 2020 10:20 pm
Forum: Personal Investments
Topic: Worth the hassle to open an HSA in California?
Replies: 47
Views: 5137

Re: Worth the hassle to open an HSA in California?

Well, clearly you are aware, and having participated in this thread you have been pointed to the how. So now you can avoid tax fraud! Sorry, no, call me dense, but I still don’t get it. I'm not buying it and neither will the CA Franchise Tax Board. This is simply; no pre-tax and/or deductible contr...
by Spirit Rider
Tue Sep 01, 2020 8:50 pm
Forum: Personal Finance (Not Investing)
Topic: Why earnings after the age 60 are not indexed ?
Replies: 11
Views: 2104

Re: Why earnings after the age 60 are not indexed ?

Tdubs wrote: Mon Aug 31, 2020 5:33 pm So, why did they pick 60? Why not 62? Or 65?
My guess and that is all it is. They needed a couple of years to properly calculate indexing results for benefit calculations. Now that they can do it far faster computationally, they probably don't want to mess with the process.
by Spirit Rider
Tue Sep 01, 2020 8:37 pm
Forum: Personal Finance (Not Investing)
Topic: Multiple HSA contributions
Replies: 17
Views: 1259

Re: Multiple HSA contributions

Note that the copayments aren't in effect until you exceed the deductible. You have to pay the full discounted fee (without copayments) until then. A very relevant piece of information that the OP did not know/provide. Note: This plan's deductibles are exactly the minimum HSA deductible. If they we...
by Spirit Rider
Tue Sep 01, 2020 2:39 pm
Forum: Personal Finance (Not Investing)
Topic: Multiple HSA contributions
Replies: 17
Views: 1259

Re: Multiple HSA contributions

As has been pointed out, having a deductible > the HSA minimum deductible is not sufficient to be considered an HDHP. A health insurance plan is not an HDHP if it provides any other coverage other than (preventive, etc...) before the HSA minimum deductible is met. The two most common ways a health i...
by Spirit Rider
Sun Aug 30, 2020 10:08 pm
Forum: Personal Investments
Topic: [Can I move out of TSP and avoid tax issues?]
Replies: 16
Views: 894

Re: [Can I move out of TSP and avoid tax issues?]

As mentioned in the subject of this web discussion TSP has slowly increased their fees/costs to manage their funds over the years, and as it now stands, the total cost (Net administrative cost and other fees) of the individual TSP funds as of 2019 are: 0.043% G fund; 0.046% F fund, 0.043% C fund, 0...
by Spirit Rider
Sun Aug 30, 2020 10:00 pm
Forum: Personal Investments
Topic: Help me understand RMDs on a Roth 457
Replies: 8
Views: 545

Re: Help me understand RMDs on a Roth 457

Just make sure you rollover the 457b Roth 401k account to a Roth IRA account at least one year before the year RMDs are required. Otherwise, you will have to complete the RMD before the rollover can be done.
by Spirit Rider
Sun Aug 30, 2020 9:33 pm
Forum: Personal Investments
Topic: Where to start with mega backdoor Roth IRA?
Replies: 54
Views: 4455

Re: Where to start with mega backdoor Roth IRA?

In my case I can elect different investments for pre-tax, Roth, and after-tax. So I don't need to do so for the reasons you listed. I'm still amazed how different seeming similar plans are with Fidelity. Nice that you have the option! Plan features are determined by plan sponsors (employers) among ...
by Spirit Rider
Sun Aug 30, 2020 9:21 pm
Forum: Personal Finance (Not Investing)
Topic: 100k Loophole Question
Replies: 16
Views: 2709

Re: 100k Loophole Question

But she wants to pay me comparable mortgage interest rate if she refinanced. I think that makes her feel better. I could accept it and give it back to her in nice form of birthday gifts or something. Does the $100k loophole still apply since that means the interest will be greater than AFR (current...
by Spirit Rider
Sun Aug 30, 2020 8:30 pm
Forum: Personal Investments
Topic: Employee Fiduciary Solo 401(k) with MegaBackdoor Roth and TPA - Discussion
Replies: 59
Views: 2533

Re: Employee Fiduciary Solo 401(k) with MegaBackdoor Roth and TPA - Discussion

I think it is an old 401k, not the one that vm81 is planning to open at EF. Well my understanding is what Spirit Rider said - you can not move your Roth 401K employEE deferral out to a Roth IRA while still employed OR plan exists for solo 401k. I am not sure that the fact that I am moving custodian...
by Spirit Rider
Sun Aug 30, 2020 7:58 am
Forum: Personal Investments
Topic: Employee Fiduciary Solo 401(k) with MegaBackdoor Roth and TPA - Discussion
Replies: 59
Views: 2533

Re: Employee Fiduciary Solo 401(k) with MegaBackdoor Roth and TPA - Discussion

2) So I have some assets sitting in Roth 401k that were employEE deferral. They will have to sit at Employee Fiduciary as they cant be rolled over to a roth IRA. Why can't they be rolled into Roth IRA? IRS regulations prohibit the in-service rollover of employee deferrals prior to age 59 1/2. This ...
by Spirit Rider
Sun Aug 30, 2020 12:40 am
Forum: Personal Finance (Not Investing)
Topic: 100k Loophole Question
Replies: 16
Views: 2709

Re: 100k Loophole Question

MathIsMyWayr wrote: Sun Aug 30, 2020 12:29 am If both OP and sister are married, may OP/spouse gift sister/spouse a total of 4*$15,000=$60,000 per year without any consideration of reporting or taxes?
That does not change the fact that if he expects repayment these are not gifts and are loans subject to the AFR rules.
by Spirit Rider
Sun Aug 30, 2020 12:37 am
Forum: Personal Finance (Not Investing)
Topic: Cobra and ObamaCare
Replies: 19
Views: 1827

Re: Cobra and ObamaCare

To clarify, you have 60 days to elect COBRA coverage from the latter of the end of your employer's coverage or when your actually receive the COBRA notice election packet (usually about two weeks after separation). Then you have 45 days to pay for and activate the COBRA coverage. So technically, you...
by Spirit Rider
Sun Aug 30, 2020 12:16 am
Forum: Personal Finance (Not Investing)
Topic: 100k Loophole Question
Replies: 16
Views: 2709

Re: 100k Loophole Question

My sister is trying to payoff her mortgage remaining of about 85k @ > 6%, since I'm not getting much out of my savings, I want provide the loan to pay it off and she can pay me back monthly. I had initially thought the best way may be to "gift" her the money and then she can gift the money back. Th...
by Spirit Rider
Sat Aug 29, 2020 11:42 pm
Forum: Personal Finance (Not Investing)
Topic: Fidelity sent information packet about my Solo 401k to my wife
Replies: 28
Views: 3322

Re: Fidelity sent information packet about my Solo 401k to my wife

It may be a mistake or it may be a new Fidelity policy and have nothing to do with the fact that she is a beneficiary, but rather because she is your spouse. 401k plan loans or distributions of married individuals require spousal consent. However, the wording seems more likely to be a mistake. If it...
by Spirit Rider
Sat Aug 29, 2020 3:36 pm
Forum: Personal Finance (Not Investing)
Topic: Liability for 2nd mortage on deceased BIL's condo?
Replies: 15
Views: 1242

Re: Liability for 2nd mortage on deceased BIL's condo?

According to a very recent statement by the attorney hired by the sisters to assist with the dispensation of the estate, they (the sisters) are liable for the balance of the 2nd mortgage as the condo constitutes "personal property". The plan is get the condo cleaned up (in progress) and put it up o...
by Spirit Rider
Sat Aug 29, 2020 1:37 pm
Forum: Investing - Theory, News & General
Topic: Why is Apple doing a stock split?
Replies: 35
Views: 3118

Re: Why is Apple doing a stock split?

Even Warren Buffet who is famous for Berkshire Hathaway's stratosphere stock price, offered Class B shares at a fraction of Class A prices and then did a later split. I don't want to derail the thread, but Buffet's decision to create the BRK Class B was a move designed to prevent others from creati...
by Spirit Rider
Sat Aug 29, 2020 1:30 pm
Forum: Personal Finance (Not Investing)
Topic: Impact of 401k contributions on unemployment benefits (Texas)
Replies: 8
Views: 714

Re: Impact of 401k contributions on unemployment benefits (Texas)

Thanks for the reply spirit and digging into the act. I had read that but thought it was referring to any employer contributions to a 401k rather than employee . Which absolutely makes sense. But I could be interpreting it incorrectly. I do not profess to know the answer, just an opinion from a cur...
by Spirit Rider
Sat Aug 29, 2020 1:19 pm
Forum: Personal Finance (Not Investing)
Topic: HSA Receipt
Replies: 20
Views: 1385

Re: HSA Receipt

When I received a CP2000 Notice on large HSA distributions*, I only provided a subset of 1 and 2 and received notice it was closed. However, I was prepared with the required proofs, which might likely be required in an in-person audit. Would you mind sharing with us how large the distribution was t...
by Spirit Rider
Sat Aug 29, 2020 11:56 am
Forum: Personal Finance (Not Investing)
Topic: HSA Receipt
Replies: 20
Views: 1385

Re: HSA Receipt

My opinion is that they look for "reasonable" evidence when looking at documents - especially if amounts are not huge. Invoices are probably acceptable evidence. I work with a couple of former IRS agents in TaxAide and they have both told me that the IRS is really just looking for reasonable assura...