Keyboard Ninja
Recycles dryer sheets
- Joined
- Apr 13, 2008
- Messages
- 157
I'm re-enlisting in the USAF sometime mid-2009, and there is a bonus. While I wasn't re-enlisting for the bonus (actually because I want to earn a Master's Degree and hopefully become an Officer) it is a nice perk. If I am not in a tax-free zone at the time of reenlisting then I have a problem...
I was planning on putting all of the cash ($35,000) into my TSP account to avoid paying taxes. The thing is the max is $15,000 I believe. I could contribute some of it to a traditional IRA, but I'm unsure on how that works. Would I have to link up the traditional IRA to my paycheck so they can pull out pre-tax money? Also is the contribution limit $5000/year for the Roth IRA and traditional IRA combined? Or is it $5000/year for a Roth IRA, and another $5000/year for the traditional IRA?
NOTE: Another problem is that I contribute to my TSP every month. In reality I might only be able to contribute about $10,000 out of the $35,000.
Even if I were able to max all of that out I'm still stuck with left over cash. What other pre-tax vehicles could I use to store the money? I've thought about a college 529 program for Texas, but I'm unable to find any information on pre-tax payments (if that is even an option). Figured I might want to think about saving up something for my future kid(s). My only problem with that would be if I were able to get a job at a local University would I be able to get that money back out of the 529 program. Figured my kid could go to school for free as long as I worked at the school, but I'm just speculating at this point.
Are there any tax-free shelters (long-term and short-term) that I could possibly look into?
I was planning on putting all of the cash ($35,000) into my TSP account to avoid paying taxes. The thing is the max is $15,000 I believe. I could contribute some of it to a traditional IRA, but I'm unsure on how that works. Would I have to link up the traditional IRA to my paycheck so they can pull out pre-tax money? Also is the contribution limit $5000/year for the Roth IRA and traditional IRA combined? Or is it $5000/year for a Roth IRA, and another $5000/year for the traditional IRA?
NOTE: Another problem is that I contribute to my TSP every month. In reality I might only be able to contribute about $10,000 out of the $35,000.
Even if I were able to max all of that out I'm still stuck with left over cash. What other pre-tax vehicles could I use to store the money? I've thought about a college 529 program for Texas, but I'm unable to find any information on pre-tax payments (if that is even an option). Figured I might want to think about saving up something for my future kid(s). My only problem with that would be if I were able to get a job at a local University would I be able to get that money back out of the 529 program. Figured my kid could go to school for free as long as I worked at the school, but I'm just speculating at this point.
Are there any tax-free shelters (long-term and short-term) that I could possibly look into?