Recent content by borrom2002

MrLoco. In the scenario I intend to pay taxes on the state tax refund money the next year. The idea is 2 years of 50k income is paid in a lower tax bracket then 1 year of 100k income. It is not like I am trying to get 50k tax free just break it out over 2 years.

So if you are MFJ and around 80k or less you could do this I would think since it is below the AMT exemption. So 40k each year.

I have always been thinking of weird ways to reduce taxes. The last few years I have had small state refunds and it got me to thinking. You are allowed to reduce your fed taxable by the amount you had withheld for state taxes if you itemize. But if that causes you to get a refund from the...

Here is an article about the most recent irs ruling to this process. New IRS Rules on After-Tax 401(k) Rollover To Roth IRA | Bankrate.com

conversions are taxable events. rollovers are not. moving after tax to a roth is a rollover not a conversion.

It looks like any after tax money rolled into the roth would be tax and penalty free to take out. UNDER AGE 59.5 FIVE YEAR CONVERSION HOLDING PERIOD NOT MET It would fall under this one. Conversions: Tax-No ;Penalty-No (Nontaxable Portion) Here is a good way to think of it. If you put...

Wait are you actually trying to count the original taxation of the money as it was earned by the company and apply it to the "burden" of the investor? If I had a choice of a 1 million dollar income from a job vs 1 million dollar income from dividends and capital gains I would always take the...

The real trick is to have 5 years of expenses in after tax money. If you can get to that it is a good tax move to put it in pre tax while you have high income. Then when you ER you convert 1 year of expenses to Roth each year and pay the taxes on that wich will be low since it will be your...

Why not do the roth conversion ladder? Save up 5 years of expenses in your taxable. Shove the rest in your pre tax accounts. Get all the tax breaks you can now. Then when you stop working and income is down convert 1 year of expenses each year for 5 year all the while living on the 5...

Are you guys forgetting the 10% penalty? For early retirement Roth would always be better because at least you can get principle tax and penalty free. If you are taking trad 401k/IRA assets before 59 1/2 you would be paying taxes and the penalty. You could do a 72T but that would be harder to...

If you are not going to taking a distribution for that particular expense ever then I would think you would fall under the normal deduction rules. "You may deduct only the amount by which your total medical care expenses for the year exceed 7.5% of your adjusted gross income"

Here is the info. straight from the IRS. Q-39. When must a distribution from an HSA be taken to pay or reimburse, on a tax-free basis, qualified medical expenses incurred in the current year? A-39. An account beneficiary may defer to later taxable years distributions from HSAs to pay or...

I think Roth 401k's can be great for early retirement. If you are going to retire before 55 look at it like this. When you retire you can roll the 401k money into iras. The money the company matches in your 401k is always tax deferered so that money can go into a traditional IRA. The roth...