I don't want to kick off the dreaded "payoff the house" thread. I know it's an emotional decision. Sleep at night kind of stuff.
Got an acquaintance who is interested in paying off his house. He's just turned 59.5 and has a nest egg. Unfortunately, it's all in deferred accounts. Mortgage is in the neighborhood of 200k. From my limited understanding he'll have to pay income tax on all of this money. Is that right? And this tax bill would be at normal income rates using this 200k income. Not the 15% dividend rate, right?
By my thinking, this would be a terrible way to get this done. Do I understand this right? I'm thinking of steering him another way, but wanted to run it past the group first.
Gracias,
devo O0
Got an acquaintance who is interested in paying off his house. He's just turned 59.5 and has a nest egg. Unfortunately, it's all in deferred accounts. Mortgage is in the neighborhood of 200k. From my limited understanding he'll have to pay income tax on all of this money. Is that right? And this tax bill would be at normal income rates using this 200k income. Not the 15% dividend rate, right?
By my thinking, this would be a terrible way to get this done. Do I understand this right? I'm thinking of steering him another way, but wanted to run it past the group first.
Gracias,
devo O0