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YE Tax Changes - NUA strategy ?
Old 08-10-2012, 11:17 PM   #1
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YE Tax Changes - NUA strategy ?

Hi,
Anyone venture a "best guess" as to when we will know if the Busch Tax Cuts will be extended ? (Dividends and Capital Gains)

Weighs heavily into a 401k Rollover - NUA strategy if looking to retire in the next 5-8 months. Any thoughts on strategy with this uncertainty ?

-Mike G.
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Old 08-11-2012, 05:46 AM   #2
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Right after the election. Lame duck session. Will extend it.
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Old 08-11-2012, 06:50 AM   #3
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Right after the election. Lame duck session. Will extend it.
Actually I believe it is contingent on raising the debt ceiling but I could be wrong.

And if the debt ceiling is not raised a bunch of other budget cuts kick in, which in and of itself is not a bad thing IMHO.
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Old 08-11-2012, 09:09 AM   #4
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Hi,
Anyone venture a "best guess" as to when we will know if the Busch Tax Cuts will be extended ? ...
Heck, if they are going to cut taxes on beer, couldn't they choose a better beer?



-ERD50
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Old 08-11-2012, 09:30 AM   #5
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I've been reading that it will be extended but there is an earmark attached. Something about raising the amount of money needed to study the drinking habits of Chinese Prostitutes.
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Old 08-11-2012, 01:03 PM   #6
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If Washington worked they would have compromise by now, such as: making Bush tax cuts permanent and added capital gains and dividends to AMT calculation.
I suspect, nothing happens until after election, possibly even having to make changes in 2013 retroactive to 2012. If you make >250K, chances are 50/50, if less, then I think you can count on them being extended.
TJ
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Old 08-11-2012, 02:40 PM   #7
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Please spell out what NUA is.
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Old 08-11-2012, 02:45 PM   #8
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I think that can of Busch will be kicked down the road between Thanksgiving and Christmas.
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Old 08-11-2012, 03:09 PM   #9
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NUA = Net Unrealized Appreciation

It would be appreciated if people could be a little descriptive when posting somewhat obscure TLA (Three Letter Acronyms). Thanks.
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Old 08-11-2012, 03:22 PM   #10
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I'll be surprised if anything is firm before the end of the year. It sounds like there are very firm positions regarding the >$250k taxes that will hold everything up. I bet there'll be a lot of retroactive and short-term changes once again.
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Old 08-12-2012, 05:58 PM   #11
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Thanks all. Looks like anyone with income over $250k and long term capital gains needs to cash in and capture the 15% rate before year end - to much uncertainty going forward. Could be a lot of selling at year end. Also, anyone with a large NUA option in their untampered 401K needs to take a hard look at a prompt rollover, selling, and capturing the 15% tax rate.....all before year end.
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Old 08-12-2012, 07:37 PM   #12
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Mmgoebe, I was a bit cocerned about the preferred tax treatment of NUA when I cashed out my company stock at the end of 2008. I had nearly $300k of NUA. One thing to beware of - even though the NUA itself is taxed at 15%, it may cause the rest of your income to be taxed at a higher rate. That NUA put me into the AMT for the rest of my small wage income which would have been taxed at only 15%. And don't forget about state income taxes.
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