Couples with disparate incomes

[bigreader]

She did in preparation for moving back to TX from California. Then we took a few years off In Mexico. Planned a 5 yr payout and got the 10% back from California for the 5 years and didn't pay much for federal for the 5 years. It's definitely a planning thing and we would have, in hindsight, done more years of deferment and the 10 years payout. Definitely worked the way we planned.

Otherwise we would have paid out around 40% state & fed...

At my old job, the key was to leave the company and retire. If you leave for another job, even if you elect a long payout period, the tax ramifications are ugly since you now have two "salaries." Looks like your family handled it perfectly, down to the out of state/country move!

 

[Surewhitey]

At my old job, the key was to leave the company and retire. If you leave for another job, even if you elect a long payout period, the tax ramifications are ugly since you now have two "salaries." Looks like your family handled it perfectly, down to the out of state/country move!

Yeah, we had to file CA tax returns for 5 years and they returned all the auto withholdings too. It really worked well for us. We were pushing 40% state and fed tax rates if we didn't have this option.