Search found 8532 matches

by Spirit Rider
Thu Sep 20, 2018 2:41 pm
Forum: Personal Finance (Not Investing)
Topic: self-employed professional - the best way to get things started?
Replies: 19
Views: 1490

Re: self-employed professional - the best way to get things started?

The increased QBI deduction will mostly or even exceed any FICA tax savings. S-Corps will have far less of an advantage over a sole proprietorship with the Section 199A QBI deduction. This is not including any state fees, taxes and does not include increased the tax complexity, payroll and filing c...
by Spirit Rider
Thu Sep 20, 2018 10:15 am
Forum: Investing - Theory, News & General
Topic: Tax Reform - Revised Kiddie Tax
Replies: 57
Views: 7222

Re: Tax Reform - Revised Kiddie Tax

With the latest post by 2beachcombers, does this mean that the draft form is saying that the 0% tax rate is applicable to $4700 of unearned income? (assuming no earned income). Thanks. It depends on how much is ordinary income and how much is LTCG/QDIV. The 0% rate only applies to the latter. With ...
by Spirit Rider
Thu Sep 20, 2018 12:36 am
Forum: Personal Finance (Not Investing)
Topic: General 2018 Tax Question
Replies: 25
Views: 2356

Re: General 2018 Tax Question

The other problem I see is that tax software providers have a lot of changes to make in a very short time. The most recent update from AARP was that the IRS has not given the final OK yet as to what changes need to be made. My personal opinion is that this is going to create a mess of software prob...
by Spirit Rider
Thu Sep 20, 2018 12:27 am
Forum: Investing - Help with Personal Investments
Topic: HELOC as a bonds replacement for drawing down from in a downturn?
Replies: 19
Views: 940

Re: HELOC as a bonds replacement for drawing down from in a downturn?

Also, keep in mind that HELOC interest that is not used to purchase, refinance or improve the secured property is no longer tax deductible. Further increasing the borrowing costs.
by Spirit Rider
Thu Sep 20, 2018 12:22 am
Forum: Personal Finance (Not Investing)
Topic: self-employed professional - the best way to get things started?
Replies: 19
Views: 1490

Re: self-employed professional - the best way to get things started?

hi guys, ok after your helpful replies we decided to 1. stay sole-prop 2. open SEP IRA and max contribute (i like the idea of less paper work) 3. don't get into stocks or anything yet, just keep saving money for home down payment one last question - what do i do with an LLC we created? we don't wan...
by Spirit Rider
Thu Sep 20, 2018 12:17 am
Forum: Personal Finance (Not Investing)
Topic: self-employed professional - the best way to get things started?
Replies: 19
Views: 1490

Re: self-employed professional - the best way to get things started?

W2 is not counted as QBI. It would therefor be advantageous to have an SCorp, pay yourself the following: Strike 1. The fact that an S-Corps W-2 wages are not QBI means the QBI will be less, a definite disadvantage. Solo 401k max employer contribution is 36500. 36500/.25 is 146,000. Take the remind...
by Spirit Rider
Wed Sep 19, 2018 10:38 pm
Forum: Investing - Theory, News & General
Topic: Tax Reform - Revised Kiddie Tax
Replies: 57
Views: 7222

Re: Tax Reform - Revised Kiddie Tax

No, the capital gains that puts the total unearned income past $4700 should be taxed at the capital tax rate (15%) of the next bracket. $5200 - $4700 = $500 This is the same as the way standard tax brackets work. I really think you should wait until the relevant instructions are released in at leas...
by Spirit Rider
Wed Sep 19, 2018 7:52 am
Forum: Investing - Help with Personal Investments
Topic: UTMA help.... advice needed for inherited UTMA
Replies: 9
Views: 485

Re: UTMA help.... advice needed for inherited UTMA

However, this would enable you to rollover the balance in the UTMA account to a UTMA 529 account prior to college. If you and the student will be on the bubble of financial aid. UTMA accounts can be very detrimental to the FAFSA calculation. But its not like a student-owned 529 account is not detri...
by Spirit Rider
Wed Sep 19, 2018 1:33 am
Forum: Investing - Help with Personal Investments
Topic: UTMA help.... advice needed for inherited UTMA
Replies: 9
Views: 485

Re: UTMA help.... advice needed for inherited UTMA

With the recent tax reform change to trust tax brackets for UTMA unearned income above the dependents standard deduction and tax rate. It is far more favorable to hold equities in UTMA accounts. You can have up to $4700/year in LTCGs and QDIVs and pay no taxes. However, even with that, you will want...
by Spirit Rider
Wed Sep 19, 2018 1:18 am
Forum: Personal Finance (Not Investing)
Topic: self-employed professional - the best way to get things started?
Replies: 19
Views: 1490

Re: self-employed professional - the best way to get things started?

Clarifying some incomplete and misinformation: Best option is to set up a solo 401k for each of you if both doing separate businesses. If wife is employed with you, she can be on your solo 401k plan. You can contribute the most this way. You can contribute $18500 for each individual and the business...
by Spirit Rider
Tue Sep 18, 2018 7:23 am
Forum: Investing - Help with Personal Investments
Topic: SIMPLE IRA, solo 401(k) & Backdoor Roth
Replies: 12
Views: 626

Re: SIMPLE IRA, solo 401(k) & Backdoor Roth

There was nothing in the recent tax reform changing SIMPLE IRA rollovers rules. Rollovers >= 2 years have existed for a significant period of time, possibly since inception. There was never any incentive to roll them into a qualified plan until 2010 and the Backdoor Roth. However, rollover contribut...
by Spirit Rider
Tue Sep 18, 2018 12:07 am
Forum: Investing - Help with Personal Investments
Topic: Solo 401k
Replies: 1
Views: 246

Re: Solo 401k

As has been pointed out many, many times on this forum. You do not have to mail contributions to Fidelity's Self-Employed 401k (SE401K). You can do a one day ACH to a Fidelity Cash Management Account (CMA), wait for the hold to expire and do a phone transfer from the CMA to the SE401K. I prefer inde...
by Spirit Rider
Mon Sep 17, 2018 11:50 pm
Forum: Personal Finance (Not Investing)
Topic: Baby on the way - HSA questions
Replies: 19
Views: 1630

Re: Baby on the way - HSA questions

You are considered to have HSA eligibility for any month you have qualifying HDHP coverage on the first of the month. If you had coverage for any of July 2017. Your 2017 contribution limit would be 7 / 12 * $3400 ~= $1983. Even if your coverage ended on 6/30, your 2017 contribution limit would be 6...
by Spirit Rider
Mon Sep 17, 2018 11:19 pm
Forum: Investing - Help with Personal Investments
Topic: SIMPLE IRA, solo 401(k) & Backdoor Roth
Replies: 12
Views: 626

Re: SIMPLE IRA, solo 401(k) & Backdoor Roth

@FiveK is correct.

When the 2-year rollover restriction is met, you can rollover a SIMPLE IRA to any other retirement plan that accepts IRA rollovers. There is nothing that prevents you from rolling over a SIMPLE IRA after 2 years to a 401k.
by Spirit Rider
Sun Sep 16, 2018 9:09 pm
Forum: Investing - Help with Personal Investments
Topic: Setting up Backdoor Roth IRA, can't figure out where to stuff IRA
Replies: 20
Views: 1697

Re: Setting up Backdoor Roth IRA, can't figure out where to stuff IRA

I'm guessing that pursuing the backdoor Roth IRA plan is still better because it would allow the $18500 in the 401k pretax PLUS the $5500 in the Roth IRA. Right? Yes, a Backdoor Roth is not done because it is a Roth, but rather because it is extra tax-advantaged contribution space. Any decision whe...
by Spirit Rider
Sun Sep 16, 2018 9:03 pm
Forum: Personal Finance (Not Investing)
Topic: Could I open two Solo 401 [Solo 401(k)s]
Replies: 17
Views: 1013

Re: Could I open two Solo 401 [Solo 401(k)s]

E*Trade is a bit wonky in this regard--I can't require 1000/year, but I can require "a year of service". ... So, it seems that 1,000/year is in fact part of the plan, if I choose the minimum of 1 year of service in the adoption agreement? I should have stated that the 1000 hours/year is a sub restr...
by Spirit Rider
Sun Sep 16, 2018 2:32 pm
Forum: Personal Finance (Not Investing)
Topic: Could I open two Solo 401 [Solo 401(k)s]
Replies: 17
Views: 1013

Re: Could I open two Solo 401 [Solo 401(k)s]

BusterMcTaco wrote:
Sun Sep 16, 2018 12:13 pm
I'm pretty sure Spirit Rider was making fun of himself* (and his own prior phrasing).

*Or herself? I hate the lack of gender neutral pronouns.
Yup, I was making fun of the previous gibberish.

Hint: A Spirit Rider would appear as a brave astride a white horse.
by Spirit Rider
Sun Sep 16, 2018 10:09 am
Forum: Personal Finance (Not Investing)
Topic: Could I open two Solo 401 [Solo 401(k)s]
Replies: 17
Views: 1013

Re: Could I open two Solo 401 [Solo 401(k)s]

Or maybe the answer is in the wording that Spirit Rider has used. Maybe they don't accept a "rollover" but they would do an adoption agreement to amend a current plan at some other provider and accept that money.... which might not be called a "rollover". Wow, who wrote that post. I think that verb...
by Spirit Rider
Sun Sep 16, 2018 7:39 am
Forum: Personal Finance (Not Investing)
Topic: Could I open two Solo 401 [Solo 401(k)s]
Replies: 17
Views: 1013

Re: Could I open two Solo 401 [Solo 401(k)s]

Correct. A one-participant 401k plan cannot have eligible non-spouse employees. Any employee not meeting the eligibility requirements is excluded from the plan. Note: Employee eligibilty restrictions apply to all employees including the owner-employee(s) and spouse-employee(s). You need to adopt or ...
by Spirit Rider
Sat Sep 15, 2018 6:47 pm
Forum: Investing - Help with Personal Investments
Topic: What if I exceed the 55k 401k limit?
Replies: 4
Views: 850

Re: What if I exceed the 55k 401k limit?

A plan is required to have processes in place to proactively limit employee after-tax contributions to prevent excess annual additions during the plan year. Excess annual additions are a plan error. However, excess annual additions due to forfeitures and non-scheduled profit sharing are not usually ...
by Spirit Rider
Sat Sep 15, 2018 6:19 pm
Forum: Personal Finance (Not Investing)
Topic: Could I open two Solo 401 [Solo 401(k)s]
Replies: 17
Views: 1013

Re: Could I open two Solo 401 [Solo 401(k)s]

Thanks I think this is what I will do and leave i40k at Fidelity. I have not yet funded the vanguard account. Could I simply close it down? Then open a new one at Fidelity? Thanks A 401k plan exists as soon as it is adopted. If you terminated the Vanguard Individual 401k plan, there is what is call...
by Spirit Rider
Sat Sep 15, 2018 6:05 pm
Forum: Personal Finance (Not Investing)
Topic: Employee to Consultant - What to Do with Previous 401k, Solo 401k
Replies: 2
Views: 273

Re: Employee to Consultant - What to Do with Previous 401k, Solo 401k

nt contr I am in the process of transitioning from employee to consultant (consulting back to the same company). Be aware, on the 8/8/18 notice of proposed Section 199A rulemaking, the IRS regulations specifically disallow the 20% QBI deduction for independent contractors who were previously employ...
by Spirit Rider
Sat Sep 15, 2018 5:15 pm
Forum: Personal Finance (Not Investing)
Topic: Could I open two Solo 401 [Solo 401(k)s]
Replies: 17
Views: 1013

Re: Could I open two Solo 401 [Solo 401(k)s]

@niceguy7376 is correct. An employer may only have one 401k plan active at the same time covering the same employees. This is still true for a one-participant 401k You would need to do the following: Complete the Fidelity Self-employed 401k adoption agreement by selecting the option to amend a curre...
by Spirit Rider
Sat Sep 15, 2018 2:49 pm
Forum: Personal Finance (Not Investing)
Topic: Documentation for IRS
Replies: 7
Views: 468

Re: Documentation for IRS

Did you include the rollover amount on Form 1040 Line 15a, $0 on Line 15b, "rollover" on the dotted line and included an explanatory statement? If not, that is probably the reason for the IRS notice.
by Spirit Rider
Sat Sep 15, 2018 2:15 pm
Forum: Personal Finance (Not Investing)
Topic: Baby on the way - HSA questions
Replies: 19
Views: 1630

Re: Baby on the way - HSA questions

So I contacted my wifey HR and also her HRA administrator (Payflex). Her HR said we cannot use her HRA for my medical expenses but transferred me to Payflex for confirmation. Payflex said we could use it but said as long as I don't double dip using the HRA and HSA for my expenses I'd be OK. Unfortu...
by Spirit Rider
Fri Sep 14, 2018 5:07 pm
Forum: Investing - Help with Personal Investments
Topic: Over Contribution on 401k
Replies: 5
Views: 639

Re: Over Contribution on 401k

I don't know if it is an IRS regulation or not, but my experience was that plans wouldn't return excess contributions and earnings until after the end of the year (12/31). Sometimes not until after W-2s are received.
by Spirit Rider
Fri Sep 14, 2018 4:27 pm
Forum: Personal Finance (Not Investing)
Topic: Mega Backdoor question - from 401(k) to Roth IRA without intermediary traditional IRA?
Replies: 11
Views: 834

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

I just thought of one thing that might have been relevant to the OP and be relevant to others following this thread A plan may, but is not required to do the split-rollover of after-tax contributions -> Roth IRA and after-tax earnings -> traditional IRA or other pre-tax accounts. However, you can pa...
by Spirit Rider
Thu Sep 13, 2018 8:29 pm
Forum: Personal Finance (Not Investing)
Topic: Mega Backdoor question - from 401(k) to Roth IRA without intermediary traditional IRA?
Replies: 11
Views: 834

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

Thanks for the clarification - the rollover was not direct. We can only get a check made payable to us for in-service withdrawals. Thus, I received a check made payable to me (after withholding) which I deposited into my checking account, and then wrote a new check for the full amount (replenishing...
by Spirit Rider
Thu Sep 13, 2018 8:17 am
Forum: Investing - Help with Personal Investments
Topic: rmd for IRAs at multiple institutions
Replies: 18
Views: 1167

Re: rmd for IRAs at multiple institutions

My understanding is that you can also take just one 401(k) distribution if you have multiple 401(k)s. You must take your RMD separately from each 401K...........unlike IRAs. Correct. You can only aggregate RMDs exclusively within the following categories: Owned IRA accounts Inherited IRA accounts f...
by Spirit Rider
Thu Sep 13, 2018 8:10 am
Forum: Personal Consumer Issues
Topic: Pet insurance
Replies: 31
Views: 2712

Re: Pet insurance

The economics of pet insurance are just like any other insurance. The insurance company's premiums have to cover, claims, administration, compliance, fees and taxes, This means on average it has to pay out substantially less in claims than premiums to stay in business. Therefore, you should only car...
by Spirit Rider
Wed Sep 12, 2018 10:21 pm
Forum: Personal Finance (Not Investing)
Topic: Solo 401k question
Replies: 3
Views: 347

Re: Solo 401k question

If you have a partnership with only the two spouses as partners you don't have to file on a Form 1065. You can elect to file as a qualified joint venture see Schedule C Instructions. It is far easier with no K-1s. Your spouse can make employee elective contributions up to 100% of her net self-employ...
by Spirit Rider
Wed Sep 12, 2018 9:47 pm
Forum: Personal Finance (Not Investing)
Topic: Solo 401(k) Questions (and sanity check)
Replies: 22
Views: 1344

Re: Solo 401(k) Questions (and sanity check)

No, employer contributions must be pre-tax.
by Spirit Rider
Wed Sep 12, 2018 8:59 pm
Forum: Personal Finance (Not Investing)
Topic: backdoor Roth conversion - is this is correct?
Replies: 12
Views: 944

Re: backdoor Roth conversion - is this is correct?

Wouldn't converting the basis of the non deductible tIRA contributions to the Roth-IRA first, followed by rolling over the remaining tIRA value to his TSP second, avoid accruing any of the smallish taxable amount of the conversion? (As long as both are done well before the end of the year). Yes and...
by Spirit Rider
Wed Sep 12, 2018 5:21 pm
Forum: Personal Finance (Not Investing)
Topic: 1099 and mortgage qualification
Replies: 15
Views: 790

Re: 1099 and mortgage qualification

It is not guaranteed to be two years. The underwriting guidelines say 12 - 24 months. My personal experience was they wanted a minimum of one tax return and then prorated it by the months in business. In my case say $60K for the first tax return, in business for 18 months = $60K * 1.5 / 2 = $45K was...
by Spirit Rider
Wed Sep 12, 2018 4:12 pm
Forum: Personal Finance (Not Investing)
Topic: Roth Contribution Amount (RSUs income - HSA contribution)
Replies: 1
Views: 159

Re: Roth Contribution Amount (RSUs income - HSA contribution)

I saw a reply in this thread by Spirit Rider that I now question if I contributed too much to a Roth this 2018 tax year. https://www.bogleheads.org/forum/viewtopic.php?f=1&t=258634&p=4113190#p4112756 I'm retired and my only source of taxable compensation is vesting of my RSUs (restricted stock unit...
by Spirit Rider
Wed Sep 12, 2018 2:49 pm
Forum: Investing - Help with Personal Investments
Topic: Commingling pre-tax with post-tax IRA contributions
Replies: 8
Views: 546

Re: Commingling IRA and tIRA

In case it is not clear from the previous replies. The pre-tax balances and nondeductible basis in all your traditional, SEP and SIMPLE IRA accounts are treated as one for determining prorata taxation of any Roth conversions.
by Spirit Rider
Wed Sep 12, 2018 2:43 pm
Forum: Personal Finance (Not Investing)
Topic: Mega Backdoor question - from 401(k) to Roth IRA without intermediary traditional IRA?
Replies: 11
Views: 834

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

I don't know the entire history, but to my knowledge the rollover has never been required to go through tIRA. The Pension Protection Act of 2006 effective 1/1/2008, first allowed direct rollovers from qualified plans to a traditional Roth IRA. Prior to 1/1/2008, you had to rollover to a traditional...
by Spirit Rider
Wed Sep 12, 2018 2:21 pm
Forum: Personal Finance (Not Investing)
Topic: backdoor Roth conversion - is this is correct?
Replies: 12
Views: 944

Re: backdoor Roth conversion - is this is correct?

Whether you can do an "in-kind" Roth conversion is dependent on whether the traditional and Roth IRAs are at the same custodian and their policies. Most support this if both are at the same custodian. If not, less likely.
by Spirit Rider
Wed Sep 12, 2018 12:58 pm
Forum: Personal Finance (Not Investing)
Topic: 529 & my kid in college
Replies: 8
Views: 556

Re: 529 & my kid in college

I'm a Bubblehead (74 - 80), USS Benjamin Franklin (SSBN 640).
by Spirit Rider
Wed Sep 12, 2018 12:53 pm
Forum: Personal Finance (Not Investing)
Topic: Solo 401k at Wells Fargo
Replies: 7
Views: 430

Re: Solo 401k at Wells Fargo

A bigger question, is why would you possibly open this at Wells Fargo? Banks are for banking, not investing. Last time I checked these were actually; re-marketed Oppenheimer Funds Single K or aPioneer Funds Uni-K plans. They only offered fairly high expense ratio active funds. Do you even have lost ...
by Spirit Rider
Wed Sep 12, 2018 12:46 pm
Forum: Investing - Help with Personal Investments
Topic: Help with 1099 (Schedule C) taxes
Replies: 4
Views: 417

Re: Help with 1099 (Schedule C) taxes

The Section 199A 20% QBI deduction has a taxable income phaseout for service businesses. You are way above the MFJ phaseout of $415K

If this side income is from the performance of services, you will not be eligible.
by Spirit Rider
Wed Sep 12, 2018 12:26 pm
Forum: Personal Finance (Not Investing)
Topic: 529 & my kid in college
Replies: 8
Views: 556

Re: 529 & my kid in college

Morning Bogelheads, Our daughter started college this past month. We continue to save in her VG 529 plan, as it's been automatic for a long time. Question is: Is there any reason to continue to send money to VG, or should we just divert these current 529 deposits to her college ( she's going throug...
by Spirit Rider
Tue Sep 11, 2018 10:56 pm
Forum: Personal Finance (Not Investing)
Topic: Confused by Wiki Advice on HSA Spending
Replies: 44
Views: 6169

Re: Confused by Wiki Advice on HSA Spending

If you are going to make a projection based on decades of future performance. It should be based on long term past and future healthcare inflation and projected future growth not arbitrary percentages. You are still neglecting the fact that it will be a rare individual even in their 30s who has an H...
by Spirit Rider
Tue Sep 11, 2018 10:47 pm
Forum: Personal Finance (Not Investing)
Topic: backdoor Roth conversion - is this is correct?
Replies: 12
Views: 944

Re: backdoor Roth conversion - is this is correct?

Also, there likely will be a smallish taxable event on this conversion based on the gains accrued by your after-tax investments while in the tIRA... I need to check this out. Everything I have read so far has stated that any gains realized by my post tax contributions now become become "pre-tax" by...
by Spirit Rider
Tue Sep 11, 2018 10:04 pm
Forum: Personal Finance (Not Investing)
Topic: Confused by Wiki Advice on HSA Spending
Replies: 44
Views: 6169

Re: Confused by Wiki Advice on HSA Spending

I don't think the Wiki should be modified just yet. Your analysis does not factor in a real healthcare inflation rate. Over the longer term healthcare inflation has averaged 3% - 6% above the CPI. The constraints apparent after the great recession have all but evaporated. In the last couple of years...
by Spirit Rider
Tue Sep 11, 2018 9:34 pm
Forum: Investing - Theory, News & General
Topic: Possible Change to RMDs? [Executive order]
Replies: 47
Views: 6074

Re: Possible Change to RMDs? [Executive order]

ralph124cf wrote:
Tue Sep 11, 2018 4:17 pm
Any problems with this scenario?
I don't see any.

Of course, it will only reduce the AGI in the following year, but by double.
by Spirit Rider
Tue Sep 11, 2018 8:01 pm
Forum: Personal Finance (Not Investing)
Topic: Confused by Wiki Advice on HSA Spending
Replies: 44
Views: 6169

Re: Confused by Wiki Advice on HSA Spending

The only big drawback I see is if it isn't left to your spouse it all becomes taxable in the year of death. Not good. Use it for charitable bequests where it is not taxed or maybe have a plan to take non-qualified distributions at the end game. If >= age 65, no early withdrawal penalties apply, jus...
by Spirit Rider
Tue Sep 11, 2018 7:56 pm
Forum: Personal Finance (Not Investing)
Topic: Confused by Wiki Advice on HSA Spending
Replies: 44
Views: 6169

Re: Confused by Wiki Advice on HSA Spending

Most people grossly underestimate their healthcare costs in retirement. Current estimates are that a 65 year old couple retiring in 2018 will have $275K (2018 dollars) in healthcare costs in retirement. These include Medicare Part B/D premiums (maybe increased by IRMAA), Medigap (not HSA qualified e...
by Spirit Rider
Tue Sep 11, 2018 3:03 pm
Forum: Personal Finance (Not Investing)
Topic: 1099 and mortgage qualification
Replies: 15
Views: 790

Re: 1099 and mortgage qualification

As I said; both employee and employer contributions are deducted on your personal Form 1040 Line 28. They have nothing to do with your net earnings form self-employment. The lender is required by underwriting guidelines to not just take your Schedule C at face value. They will also look at the stabi...
by Spirit Rider
Tue Sep 11, 2018 2:36 pm
Forum: Investing - Help with Personal Investments
Topic: RMD will turn 70 in Nov. 2018
Replies: 22
Views: 1717

Re: RMD will turn 70 in Nov. 2018

To be more specific, as I understand it: Ex: RMD is 15K. 1)You take 10K QCD and then 5K additional withdrawals. You have satisfied the RMD and withdrawn 15K total. 2)You take 5K withdrawal and then 10K QCD. You have satisfied the RMD and withdrawn 15K total. In both of these cases you pay tax on 5K...