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Do you have an estate and/or tax planner?
Old 12-13-2009, 06:25 AM   #1
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Do you have an estate and/or tax planner?

...Or do you do it all yourself?

Things are getting more complex, and as 4 kids entering teen years, I have less time to devote to financial planning, taxes.

Considering converting Trad-IRA to Roth-IRA in 2010 as previously could not qualify. This has my head spinning. Perhaps it's time for some help.

We do our own taxes and financial planning.
Have seen a local attorney for will/trust. They do list estate planning, but not taxes under their specialties.
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Old 12-13-2009, 08:40 AM   #2
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We've had wills, bypass trusts, etc done years ago, but everything else is do-it-yourself.

We have always done our own taxes. They would probably seem complicated to someone who has not done their own taxes or to someone just starting out. However, if you start from age 16 (or your first income) and do your own taxes each year for 35 years or so, then they are easy. You don't have to learn much new each year. You do have to be well-read and cannot ignore news articles about personal taxes.

We do have some non-mainstream tax planning going on.

We figured out that we can live off of our taxable accounts for a couple of decades, delay SS and convert all our IRA/401(k) income to a Roth IRA while paying little in the way of taxes. This seems so rare that I haven't seen any write-ups in the news media about this. Otherwise it seems like it is a huge loophole that many people could use if they planned ahead.

Also we will deduct losses in two 529 plans from our 2009 taxes. How's that for advanced tax planning?

Anyways, knowledge is power.
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Old 12-13-2009, 10:14 AM   #3
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Originally Posted by tjhoo View Post
...Or do you do it all yourself?

Things are getting more complex, and as 4 kids entering teen years, I have less time to devote to financial planning, taxes.

Considering converting Trad-IRA to Roth-IRA in 2010 as previously could not qualify. This has my head spinning. Perhaps it's time for some help.

We do our own taxes and financial planning.
Have seen a local attorney for will/trust. They do list estate planning, but not taxes under their specialties.
I think an attorney is a good idea for wills & trusts. We have Vanguard named as the manager of our money should we pass on. Then the money comes to our heirs in stages as they become older adults.

It's a good idea to do your own taxes as there is no better way to learn and keep up to date on the tax laws. If you need it there are always local tax people that can help you with special cases for an hourly fee. Keeping your investments simple enough to simplify the tax treatment probably will be best for most investors in the long run. I fell out of love with tax complexity long ago.

Converting IRA's to Roth's is smart and we've been doing that for years now. My wife's IRA is now almost entirely converted. There are plenty of articles on the 2010 conversion rules and some good threads on the Bogleheads site. At Vanguard and probably other institutions, the conversion is done in a phone call -- no paperwork needed and I could even convert for my wife (she likes the money but not the financial tasks) if she had already set me up with the required forms to do her investment moves.
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Old 12-13-2009, 10:23 AM   #4
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Also we will deduct losses in two 529 plans from our 2009 taxes. How's that for advanced tax planning?
Deducting 529 losses looks tricky - looks like you have to liquidate the whole account ?

And then subject to 2% AGI hurdle for Miscellaneous Deductions and then subject to AMT.

The Tricky Art of Deducting 529 Losses at SmartMoney.com
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Old 12-13-2009, 10:59 AM   #5
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We had our wills done professionally, but everything else has been DIY. I looked into paid accumulation plans several times but never pulled the trigger as I was satisfied with my DIY efforts along with the free plans I got from Vanguard (and formerly Fido). In hindsight, I think accumulation plans are completely unnecessary.

For investing, asset allocation, I also think there is plenty written that is more than adequate. Also no need to pay a professional unless you truly want a 'set it an forget it plan' but that could be very dangerous and/or expensive IMO.

But I wonder from time to time what we might be missing, and one day I may break down and get a second (professional) opinion on financial plan - probably when I get to "distribution."
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Old 12-13-2009, 11:08 AM   #6
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We do our own taxes but have the wills done professionally.
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Old 12-13-2009, 04:11 PM   #7
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...(snip)...
But I wonder from time to time what we might be missing, and one day I may break down and get a second (professional) opinion on financial plan - probably when I get to "distribution."
Many of us wonder if we've optimized our situation. Picking a good professional is a tough task too as there is not a lot of good resources to do this job unless you have a very large portfolio so that the finders fee will be smallish in proportion. A firm like Vanguard has planning for a fee and I'd tend to go with that although it probably doesn't take into account tax issues.
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Old 12-13-2009, 04:26 PM   #8
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I did my own taxes until two things happened.
First, the taxes for our situation were getting more and more complicated.
Second, I got audited due to some errors I made in one of the filings.
Much less stress, saves me money and I am much more certain of not having errors.
However, it depends a lot on how complicated your taxes are.
We had our estate/wills prepared by a professional.
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Old 12-13-2009, 04:54 PM   #9
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I did my own taxes until two things happened.
First, the taxes for our situation were getting more and more complicated.
Second, I got audited due to some errors I made in one of the filings.
Much less stress, saves me money and I am much more certain of not having errors.
However, it depends a lot on how complicated your taxes are.
We had our estate/wills prepared by a professional.
Although I said I did my own taxes, that is only since 1993 when they became much simpler. For the first 5 years we lived here I had rental property in the UK and part of my salary delivered in the UK so I used a tax pro during those years
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Old 12-13-2009, 06:08 PM   #10
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I do not. I do have a will, trust, POA and living will drafted by an attorney who is also a CPA. My long time accountant does my taxes. I have gotten "advice" over the years by self-serving types, but I am taking steps as feasible to dig myself out from my mistakes. I am trying to educate myself and make my own decisions from here on out.
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Old 12-13-2009, 06:43 PM   #11
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It isn't just about making your own decisions.
Tax law changes every year. New deductions, old ones changing, differing treatment for businesses, rentals, depreciation, etc.
If you have a complicated income, keeping up with it all can be a full time job. And IF you make a mistake, you suddenly have a second full time job trying to clear it all up.
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Old 12-13-2009, 09:39 PM   #12
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A will is a very good idea. Financial assets can often be passed on "POD" (payable on death) to your DW (and vis-versa) or as right of survivorship.

The tough part is figuring out who should/is willing to take charge of the chillin's in case you both buy it at the same time (car wreck, etc.) or in quick succession. This requires careful planning and you have to get someone (family member, typically) to buy in.

It is best to separate the management of your surviving assets from the care of the kids, just to be prudent.
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Old 12-14-2009, 03:08 AM   #13
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after 2 flaws in 2 wills and trusts we ran into in our lifetime so far that cost us alot of money we would only use an attorney well versed in that area and never do it on our own

as ed slott says when it comes to financial planning there are 2 parts to the game.


the first half of the game is the accumulation stage. most financial planners or even ourselves are pretty good at this part. what to buy, how to allocate, what asset classes to buy etc..

the 2nd 1/2 of the game is the spending down and passing on of our money. the 2nd 1/2 is the hard part and finding good people who know
how to play this part is even harder to find.

uncle sam has a plan already in place and that plan is he is a partner in all your retirement money that is tax defered. only you dont even know how much of a share your partner will be taking.


so you need to find the right people to expertly give you a plan so you dont get the governments plan.
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Old 12-14-2009, 10:27 PM   #14
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I will second mathjak, but you need to educate yourself. Read up on the subject as it applies to you and your state. You should not depend blindly on advisers, esp lawyers. Consult, yes, but make up your own mind. You ought to think about minimizing probate.
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Old 12-14-2009, 10:35 PM   #15
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Well even though I am an FA by trade, I have a good CPA who does my taxes every year, and a super smart estate planning attorney who keeps me up to snuff on things, and did the RLT for DW and I..........

In Wisconsin, unless a bar-cetified attorney does your will or trust, it is not considered valid by the state of Wisconsin.......
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Old 12-15-2009, 08:06 AM   #16
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I used an attorney who specializes in trusts, wills, and estate tax planning to handle all of the legal documents. You want to make sure this stuff is all buttoned down as you aren't going to be around to make sure that your wishes are carried out as intended.

Taxes are relatively simple to do these days with software programs such as TurboTax. I have done my taxes since I was 14 and agree that it has actually become simpler over the years. I have rental property, LLC's, partnerships, former company stock options and a variety of investment sales each year which results in a return about 3/4 inch thick.

The most important thing in doing your taxes is keeping meticulous records and keeping up with the yearly tax law changes. After that its just simple inputting or importing of files into the tax software. Why would I want to pay a CPA to do the same thing? To be quite honest, most CPA's who do taxes scare me just a little bit for a variety of reasons that I won't go into.
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Old 12-15-2009, 09:04 AM   #17
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I used an attorney who specializes in trusts, wills, and estate tax planning to handle all of the legal documents. You want to make sure this stuff is all buttoned down as you aren't going to be around to make sure that your wishes are carried out as intended.

Taxes are relatively simple to do these days with software programs such as TurboTax. I have done my taxes since I was 14 and agree that it has actually become simpler over the years. I have rental property, LLC's, partnerships, former company stock options and a variety of investment sales each year which results in a return about 3/4 inch thick.

The most important thing in doing your taxes is keeping meticulous records and keeping up with the yearly tax law changes. After that its just simple inputting or importing of files into the tax software. Why would I want to pay a CPA to do the same thing? To be quite honest, most CPA's who do taxes scare me just a little bit for a variety of reasons that I won't go into.
I felt the same way, until the IRS decided they didn't like some business deductions I took one year. I had used Turbo tax for 12 years before that, and had no problems. After getting batted around for 3 years by the IRS, I decided a CPA was cheap insurance so I don't have to go through that again..........
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