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Duckie

he finally started the process and noted that each of our Fidelity 1099R distribution code in box 7 was a 2 instead of an N (or R). Box 7 code 2—Early distribution, exception applies (under age 59 1⁄2). If you're under age 59.5 and take money out of your TIRA and convert it, Box 7 is supposed to be...

Duckie

kavm wrote: ↑Sun Apr 11, 2021 8:41 pm Cons:
e-Trade charges $75 as a fee for transferring out
It's not a big momentous decision but I could use a second opinion whether I am missing something.

You have $5MM. $75 is a drop in the bucket. If you want to move, move.

Duckie

I need to pay estimated taxes. I had a sizable capital gain in Q1. Do I need to pay the full amount of taxes owed on the capital gain in Q1? I am happy to do this but I saw conflicting advice elsewhere that I should spread the payment over the four quarters. Either will work, it depends on your per...

Duckie

IM_MM , welcome to the forum. Is there a reason not to dedicate a specific account fully to one of the funds in this way since they are all tax-advantaged? One caveat is the only accounts that will continue to get contributions are His/Her 403(b) and His/Her Roth IRA accounts. I suppose that might ...

Duckie

PurpleTiger , welcome to the forum. My Accounts: Employer 401k @ Fidelity (maxing out annually) ~$378k: What are your other options in this account? Employer HSA @ Optum Bank (maxing out annually, auto-investing when cash balance is above $2k) ~$20k: This is a small account. Hold just one fund here...

Duckie

His 401k – Vanguard: (16.9%) Vanguard Total International Stock Index Fund Institutional Plus Shares – VTPSX – 0.07% His Brokerage – Vanguard: (7.8%) Vanguard Total Stock Index – VTI – 0.03% (17.9%) Domestic Stock (company), repurchasing VTI when possible (2.3%) Husband Fun Fund (domestic variety) ...

Duckie

Linanq3l wrote: ↑Sat Apr 10, 2021 10:25 pm Is it better to just call Vanguard and have them do this for me?

Yes. Call Vanguard and have them recharacterize the $6000 2021 Roth IRA contribution plus earnings to the TIRA. They will do the figuring.

Duckie

I plan to continue contributing the maximum possible into the 401K (~19K). The max is $19,500 for 2021. But can I have a Roth IRA in addition to my traditional 401K. Yes. Can I contribute max of 6K post tax to this Roth IRA account? Yes. Is there any considerations or problems of having a employer ...

Duckie

Would you change anything? If you keep the HSA balance where it is then VFIAX will do. Another option would be to open an HSA at Fidelity and roll most of the current balance into it on a regular basis leaving just enough to keep the account open. Hold just PGYXX (PIMCO Government Money Market Fund...

Duckie

Boatbuilder , welcome to the forum. My CPA seems to think that since I max out the TSP (which is equivalent to a 401K) that I am not eligible to put anything into a solo 401K (but he doesn't sound too sure of himself). From what I've read, I should still be able to put 20% of my 1099 income in the ...

Duckie

Alan S. wrote: ↑Thu Apr 08, 2021 7:10 pm Correction:

The second 4000 1099R should show 0 in 2a, not 4000. Pre tax dollars are going to a TIRA in a non taxable direct rollover.

Thank you for the correction. Does that mean that box 2b does not need to be checked?

Duckie

The financebuff.com site that has a step-by-step for mega-backdoors in TurboTax doesn't really address this except that in the comments section someone has a similar issue and the response was that he should file two 1099-Rs, even though he only received one. Is that a viable solution? If you can't...

Duckie

dafioram wrote: ↑Thu Apr 08, 2021 6:10 pm You are allowed to pull out your contributions tax free after 5 years.

You are allowed to withdraw your contributions at any time for any reason without taxes or penalties. Earnings are a different matter.

Duckie

Should I just buy more VTSAX & VTIAX, and convert my tax-sheltered account into more VBTLX when I do my periodic rebalancing? Yes. Etrade does not carry many Vanguard tax-exempt funds that are mentioned in this forum, such as VWIUX, VCADX. Any suggestion on other Bond funds, or how I can search...

Duckie

I just want to know if manually reinvesting the dividends from the Vanguard settlement fund within the Roth into the same fund held in the Roth is permitted (since I make too much money for a direct contribution to the Roth). It is permitted. Using the settlement fund to buy a different fund is not...

Duckie

Because of limited good mutual funds available in my 401 & 403b plans, however, the only way to have a good overall asset allocation is to hold the same fund in both my Roth and taxable account. Where is your Roth IRA held, what custodian? What fund are you duplicating in your taxable and Roth ...

Duckie

I have been contributing to a PRE-TAX 401k, but it looks like I have a ROTH 401k and AFTER-TAX 401k as options too. Does your after-tax 401k option allow for in-plan rollovers to your Roth 401k or in-service rollovers to your Roth IRA? Whether you choose to contribute pre-tax or Roth as your $19.5K...

Duckie

Put all your bonds in pre-tax accounts (pre-tax 401k) and just stocks in taxable and the Roth IRA. What's the advantage of that? Bonds kick out a lot of ordinary income and are best in tax-sheltered accounts rather than in taxable. In general it's better to put assets with higher expected growth (s...

Duckie

I made a Roth contribution for 2020. I would like to change this to a traditional(deductible) IRA contribution. I believe I have until the tax filing deadline to do this. What is the procedure to do this at Vanguard? You call Vanguard and have them "recharacterize" the 2020 Roth contribut...

Duckie

Once the assets land in Vanguard, here's what I'm planning: - Sell the Roth and SEP holdings and buy a three-fund portfolio in each: 30% VTAPX (short-term bonds), 35% VTSAX (us stocks), 35% VTIAX (int'l stocks) - Sell all the brokerage positions and buy 100% VFIAX (s&p 500 index) - Do a backdoo...

Duckie

Current assets: Individual brokerage: $40,000 (cash) Roth IRA: $52,000 (cash) Thrift Savings Plan: $300,000, all in L 2045 fund (traditional) Liquid cash: $150,000 Why all the cash? What is its purpose? What is the best way to split my investments among the three accounts I have available (individu...

Duckie

Ben Mathew wrote: ↑Sun Apr 04, 2021 7:56 pm I would start with fractions. This may seem too elementary. But that's where the trouble usually starts IMO. Make sure she understands why

¹/₃ + ²/₅ = 1 ²/₁₅

I must be stupid. When I figure it I get 11/15ths not 17/15ths. What am I doing wrong?

Duckie

Do I need to amend my 2019 tax return to reflect the backdoor contribution for 2019 that was done in 2020? No, you do not amend the 2019 return. Just download the 2019 Form 8606 which can be sent in on its own. Print it out, fill it out, sign it, and snail-mail it in to the address (the one without...

Duckie

Her OPERS (Ohio Public Pension Fund) @ State University 03.0% OPERS Stock Index Fund (0.02%) <snip> Contributions - New annual Contributions $26,000 his 401k + Employer Contributions of $13,000 $4500 her OPERS + Employer Contributions of $3400 <snip> Funds available in her 403(b) Why is she not max...

Duckie

I recently set up a solo 401(k) for my 1099 side hustle, At what custodian? I have my Roth IRA with Vanguard and they dont allow incoming rollovers so, instead of rolling the aftertax into a RIRA I rolled into a Roth 401(k). It is my understanding that while Vanguard's solo 401k does not allow inco...

Duckie

I had a great spreadsheet setup on Google that auto input all my Fidelity index fund prices. It seems to be broken. Fidelity consolidated their main index fund classes under one ticker a couple of years ago: FSTVX was Fidelity Total Market Index Fund Premium Class. It is now FSKAX Fidelity Total Ma...

Duckie

I'm unsure of how a "Rollover IRA" is different from a traditional pre-tax IRA. Does the IRS distinguish the two? The IRS does not, but some employer plans and some states do. Meaning if she ever wants to roll that Rollover IRA back into a new employer plan some plans are more willing to ...

Duckie

Last year I had an over-contribution to my Roth IRA of about $360. I thought I properly removed the excess contribution before I filed 2019 taxes. (I contacted Vanguard by phone, explained it, and filled out a form, and they returned the over-contribution). This year, I received a 1099-R. It sounds...

Duckie

What exactly do you need to buy? Is there just an empty room and you need to buy not just the stove and fridge but also sink and cupboards? Everything. Appliances, sink, cupboards. It's very modular, often sold as a unit. Appliances of course are of a standard size so they can be replaced. Oh and i...

Duckie

We were lucky that the house came with a built-in kitchen because many don't. Stuff you don't think of here in the U.S. Yeah, the whole "purchasing a complete kitchen" thing was a new concept to us as well. People usually buy those then take it with them when they move. What exactly do yo...

Duckie

Phatkiwi , welcome to the forum. The company accountant said I should be able to just setup an account somewhere, give her the account number and institution, and she will send them a check each month and a 'lumps sum match" check once a year. She was adamant that this is how all the other emp...

Duckie

ChristopherRobin wrote: ↑Mon Mar 29, 2021 11:20 pm Out of my following investment options, which is the best and why?

Vanguard Total Stock Market Inst VITSX if you want growth.
Vanguard Inflation-Protected Inst VIPIX if you want to avoid CA taxes.

Duckie

I believe my first step would be to pay off my highest interest debt...the boat. Agree? Yes. Clearly, virtually all of my accounts are in life cycle funds. While I have enjoyed the ease of investing associated with these, I do feel as though I am seeking some amount of affirmation. Life-cycle funds...

Duckie

I did enter 6K and followed the prompts and the final step in that process looks like this https://i.postimg.cc/R0tZhpDM/Rollover1.png That's fine. You are not attempting to take a deduction for this contribution. Make sure you enter somewhere that the entire $6000 contribution is non-deductible. (...

Duckie

joetro29 wrote: ↑Sat Mar 27, 2021 8:12 pm How does one calculate what the earnings are? Like usually it’s mingled with other Roth assets?

The IRA custodian does the calculating before they withdraw assets.

Duckie

The Rollover IRA account has 32 cents. Next time convert 100% of the account to get rid of those pesky pennies. I did the 6K transfer to Rollover IRA on March 5th friday and moved it to new Roth IRA on March 8th monday. Since that was March 2021 you tell TurboTax you contributed $6000 to a TIRA for...

Duckie

I used a rollover account to make a contribution and then moved it to Roth IRA for 2020. So you contributed $6000 to a Rollover IRA then converted that $6000 to a Roth IRA. Is that correct? Was there any money left in the Rollover IRA after the conversion? When did you contribute? When did you conv...

Duckie

So, here’s my plan of action. 1. Call Fidelity and ask them to recharacterize the $4000+earnings from 2020 and $1500+earnings from 2021 to a TIRA. 2. Once those funds are “available”, move all of it to a Roth. 3. This should result in $0 in the TIRA hence avoiding the pro-rata rule. Is that the pat...

Duckie

If I contributed directly to Fidelity wouldn't any overpayment of social security or medicare taxes be refunded to me at tax time? No. Because you wouldn't be overpaying; you just wouldn't get the tax break. If you do NOT contribute via payroll withholding you do not get a refund for the payroll ta...

Duckie

FIREandNice , welcome to the forum. We have about $150,000 of cash coming to us in the span of 3 months. We've maxed out our IRAs and most of our 401K for the year already- what should we do with this money? We have a very solid cash cushion (~1year) and no large expense coming up. Since you are mo...

Duckie

Can I transfer the 4000 to a brokerage account or my bank account, transfer to TIRA and then to Roth? No. Contact your Roth IRA custodian and have them "recharacterize" your contributions (are they from 2020 or 2021?) plus earnings to your TIRA. Create a new TIRA if you need to. Once in t...

Duckie

But, from the Fidelity website it appears that I could also (i) at the end of 2021, roll my ABA balance (which would just be 2021 contributions) over to Fidelity, and (ii) going forward, make HSA contributions directly to the Fidelity account as long as I am covered by a HDHP (even though my employ...

Duckie

Can anyone suggest some intelligent questions for my Son to ask of the presenter? He could ask: How many options can the plan hold if there are limits, especially if the administrator charges more for more options? Many plans only have a dozen or so options. Other plans have hundreds. What specific...

Duckie

I'm still curious though if there are potential tax issues on Vanguard's side depending on if that second question is answered "wrong" somehow (like Vanguard tells the IRS is was $ from a Roth 401(k), and the issuer reports it as after-tax from the 401(k), so the IRS may think you're tryi...

Duckie

OLlerena10 wrote: ↑Wed Mar 24, 2021 6:21 pm I can't have the Total Bond Market index fund VBTLX, as I'd need to have a min of 3K to start with. Will the BND ETF work?

Yes, BND will work.

Duckie

teammjs2 wrote: ↑Wed Mar 24, 2021 9:37 am It's the second question I want to make 100% sure it's OK to answer yes on.

Curious about this. Bump for more views.

Duckie

I have recently moved my prev employer 401 k plan into fidelity and the funds are distributed among the below 4 funds. NON40ONXO NON40ONXQ NON40ONXR NON40ONXT Did you roll the old 401k assets into a personal IRA at Fidelity? Did you choose the new funds? Do these have names or any other information...

Duckie

So just to put a period on this thread: -If family MAGI is around $150k MFJ -If primary earning spouse participates in 401k - if non working (or limited working) spouse does not participate in 401k or similar plan Then non working spouse can max out full $7000 traditional ira (over 50) and get tax ...

Duckie

I'm wondering should I include my inherited IRA in the total of ALL tIRA year-end value ? almost seems like I could just leave this answer blank, but If the inherited IRA was from a spouse and is now titled in your name (stvyreb's IRA) it counts as your IRA. If the inherited IRA is not in your name...

Duckie

I think I need to report the 2019 year end value of the SEP on the 8606 form on line 6, correct? No. On the 2019 Form 8606, read the boxed question for line 3. It asks: "In 2019, did you take a distribution from traditional, SEP, or SIMPLE IRAs, or make a Roth IRA conversion?" If the answ...

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