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Old 11-08-2011, 12:50 AM   #41
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It depends on your sources of income. Your total tax bill might be less than $1000, which is below one of the thresholds for filing quarterly taxes. Many pensions will gladly make the income tax withholding for you, so you wouldn't necessarily have to pay quarterly
Nords, what is a 'pension'?
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Old 11-08-2011, 06:14 AM   #42
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Every GOP candidate has a new tax plan, and while I know the chances are slim any of these will make it to law - what if one did? What if we move to more of a consumption tax with much lower income taxes (like the 9-9-9 plan)? How would that work with all of the people with Roth IRA's, Roth 401k's and those converting to Roth's - that may have already paid taxes at a 30%+ rate?

I also have a taxable portfolio with well over six figures of unrealized capital gains. Since most of these new tax plans say they will exempt L/T cap gains and dividends, should I sit tight on these gains for a while to see how it turns out?

Just one more reason these major tax change plans will never work, but it's something to think about.
The consumption tax is likely to punish those with substantial holdings on which income tax has already been paid. It promises to be an additional tax on money that has already been taxed.
To stimulate the economy , the exemption of L/T cap gains and dividends might exclude assets acquired prior to the enactment of the exemption.
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Old 11-08-2011, 06:50 PM   #43
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The consumption tax is likely to punish those with substantial holdings on which income tax has already been paid. It promises to be an additional tax on money that has already been taxed.
To stimulate the economy , the exemption of L/T cap gains and dividends might exclude assets acquired prior to the enactment of the exemption.
I would think that any major tax law change would have some grandfathering in it, which would get complex. Anyway, I would sure like to see the elimination of ferderal taxes on cap gains and dividends!
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Old 11-08-2011, 08:42 PM   #44
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I would think that any major tax law change would have some grandfathering in it, which would get complex. Anyway, I would sure like to see the elimination of ferderal taxes on cap gains and dividends!
I don't know of any example where changes in American tax law included grandfather clauses. Perhaps an example would be allowing some form of depreciation schedule that had already been started by a given taxpayer of company.

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Old 11-08-2011, 09:13 PM   #45
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A consumption tax is a great way to get tax dollars out of all those middle class Joes and Janes who have been putting money away in tax privileged savings. What a great idea for politicians who can't limit their spending!!
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Old 11-09-2011, 11:59 AM   #46
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I found it hard to believe how low my taxes would be in retirement, too, Chuckanut. I assumed my taxes would be over twice what they turned out to be.

Now that I'm retired, I'm happy to say that for me, state and federal taxes together total only 14% of my income.

A lot is going to depend on the source of your retirement income. Why not run a few test scenarios through Turbotax? That might help.
W2R, is this your effective tax rate after subtractions such as deductions and exemptions, etc. If it is then mine too is about 13.3. Even though the US tax structure can be complicated for some folks I hope Congress doesn't change a thing. I know one thing that flat tax business the Republicans are touting wouldn't do me any favors.
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Old 11-09-2011, 12:21 PM   #47
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W2R, is this your effective tax rate after subtractions such as deductions and exemptions, etc. If it is then mine too is about 13.3. Even though the US tax structure can be complicated for some folks I hope Congress doesn't change a thing. I know one thing that flat tax business the Republicans are touting wouldn't do me any favors.
No, you're right - - I didn't take any deductions or exemptions into account, so it's not completely accurate. I just took the simple route - - divided the taxes paid by my income. Your tax rate is lower than mine.
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Old 11-09-2011, 01:11 PM   #48
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No, you're right - - I didn't take any deductions or exemptions into account, so it's not completely accurate. I just took the simple route - - divided the taxes paid by my income. Your tax rate is lower than mine.
By the way DOW is down over 300 pts. Do you know where I can find a short term crash helmet
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Old 11-09-2011, 03:19 PM   #49
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By the way DOW is down over 300 pts. Do you know where I can find a short term crash helmet
No big deal - - we went through worse and survived in 2008-2009, right? Let's just hang on for the ride, and then we can ride the rollercoaster back up.
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Old 11-09-2011, 03:32 PM   #50
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No big deal - - we went through worse and survived in 2008-2009, right? Let's just hang on for the ride, and then we can ride the rollercoaster back up.
Oh, I'm not worried just making small talk. I'm just anxious to get to my 100th post so maybe I won't be considered a newbie anymore. I enjoy you and others expertise here. Thank you.
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