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12-03-2017, 06:53 AM
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#81
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Thinks s/he gets paid by the post
Join Date: Aug 2006
Posts: 2,433
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Quote:
Originally Posted by audreyh1
You don’t get to pick which specific ETF, mutual fund or stock lot is sold when you sell but are forced to sell the oldest.
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FIFO is the default, but you still have the option to override the default and designate which lots you want to sell.
__________________
I'd rather be governed by the first one hundred names in the telephone book than the Harvard faculty - William F. Buckley
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12-03-2017, 06:57 AM
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#82
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Jan 2006
Location: Rio Grande Valley
Posts: 38,140
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Quote:
Originally Posted by FIRE'd@51
FIFO is the default, but you still have the option to override the default and designate which lots you want to sell.
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Not in the Senate proposed tax bill, which is what we are discussing here.
That specific lot option should would no longer be allowed for individual investors.
__________________
Retired since summer 1999.
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12-03-2017, 07:13 AM
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#83
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Thinks s/he gets paid by the post
Join Date: Aug 2006
Posts: 2,433
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Quote:
Originally Posted by audreyh1
Not in the Senate proposed tax bill, which is what we are discussing here.
That specific lot option should would no longer be allowed for individual investors.
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I stand corrected. I didn't realize that was in there. Thanks for pointing it out. I guess I better take another look at my portfolio to see if I have any losing lots that I can still designate this year and add to my harvested losses.
__________________
I'd rather be governed by the first one hundred names in the telephone book than the Harvard faculty - William F. Buckley
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12-03-2017, 07:13 AM
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#84
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Jun 2005
Posts: 10,252
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So far my investigation of the news is that something is very ambiguous about this. Is there a link to the actual text of the bill? So far, the news media does not give me any confidence in their reporting of the facts.
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12-03-2017, 07:18 AM
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#85
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Thinks s/he gets paid by the post
Join Date: Jun 2005
Posts: 1,183
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Quote:
Originally Posted by audreyh1
The whole FIFO thing limited to the retail investor will only save 0.17% of the 10 year tax revenue drop according to the JCT scoring, so why force this complexity that would have to be implemented starting Jan 1 2018 for such a tiny result?
BTW I read that after the 1986 increase in cap gains rates, realized gains seriously dropped and revenue from that activity came in far less than expected.
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This was my thought, also...it just doesn't make sense for the miniscule revenue increase and it's overturning 100 years of tax law. Also, Congress required brokerages to write costly software and systems to track basis for all investors starting a few years ago ... much of that effort will now have been wasted if this passes. My gut feeling is that the FIFO provision will be edited out of the final version. If it does make it, it's probably because it doesn't have strong advocates like many of the other former deductions that have been removed in the latest tax bill.
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12-03-2017, 07:23 AM
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#86
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Jan 2006
Location: Rio Grande Valley
Posts: 38,140
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Quote:
Originally Posted by LOL!
So far my investigation of the news is that something is very ambiguous about this. Is there a link to the actual text of the bill? So far, the news media does not give me any confidence in their reporting of the facts.
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According to reports I’ve read this was still in the Senate version of the bill when it went to the floor for a vote. https://www.cnbc.com/2017/11/20/sena...-strategy.html
The links to the text of the bill were given above but is a scan and not searchable. https://assets.bwbx.io/documents/use...XqXuQfYbRas/v0
__________________
Retired since summer 1999.
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12-03-2017, 07:25 AM
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#87
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Thinks s/he gets paid by the post
Join Date: Feb 2014
Location: Williston, FL
Posts: 3,925
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Quote:
Originally Posted by kramer
This was my thought, also...it just doesn't make sense for the miniscule revenue increase and it's overturning 100 years of tax law. Also, Congress required brokerages to write costly software and systems to track basis for all investors starting a few years ago ... much of that effort will now have been wasted if this passes. My gut feeling is that the FIFO provision will be edited out of the final version. If it does make it, it's probably because it doesn't have strong advocates like many of the other former deductions that have been removed in the latest tax bill.
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That is my thought too. It is near impossible for an individual investor to sell in a FIFO manner, across different brokerages, in any reasonable manner.
You have reinvested dividends, different buy dates, splits, reverse splits, paper shares held directly in a safe, etc. There are even forgotten accounts and forgotten positions.
I can see it if it is only at a single brokerage, where the brokerage can track dates, but not across brokerages.
__________________
FIRE no later than 7/5/2016 at 56 (done), securing '16 401K match (done), getting '15 401K match (done), LTI Bonus (done), Perf bonus (done), maxing out 401K (done), picking up 1,000 hours to get another year of pension (done), July 1st benefits (vacation day, healthcare) (done), July 4th holiday. 0 days left. (done) OFFICIALLY RETIRED 7/5/2016!!
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12-03-2017, 07:44 AM
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#88
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Jun 2005
Posts: 10,252
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I have e-mailed my US senator asking for clarification. I suggest that you all do the same thing.
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12-03-2017, 07:46 AM
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#89
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Recycles dryer sheets
Join Date: Jun 2014
Posts: 193
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Quote:
Originally Posted by audreyh1
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Yes, on page 254 if anyone wants to read it.
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12-03-2017, 07:58 AM
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#90
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Jun 2005
Posts: 10,252
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Quote:
Originally Posted by catotx
Yes, on page 254 if anyone wants to read it.
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I read that and it doesn't tell me anything because it refers to other paragraphs. All my sales are done by a regulated investment company, too.
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12-03-2017, 08:10 AM
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#91
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Administrator
Join Date: Jan 2008
Location: Chicagoland
Posts: 40,708
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Additional posts have been removed that were taking the thread off topic. Let’s please stick to proposed changes to tax law in the two bills.
This includes any discussion of individual mandate and ACA. As indicated in the OP, that should be taken up in a separate thread in the healthcare forum.
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12-03-2017, 08:24 AM
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#92
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Jun 2005
Posts: 10,252
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If you are a family with one child over age 16 (no child tax credit) under current law you get 3 exemptions (3 x $4150) and a standard deduction of $13,000 for a total of $25,450.
Under the proposed law, you get a standard deduction of $24,000.
So your taxable income will increase by $1,450.
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12-03-2017, 08:39 AM
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#93
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Thinks s/he gets paid by the post
Join Date: Oct 2017
Location: Tellico Village
Posts: 2,622
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Some tax plans are good, and some tax plans are bad.
VW
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12-03-2017, 08:47 AM
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#94
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Jan 2006
Location: Rio Grande Valley
Posts: 38,140
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Quote:
Originally Posted by LOL!
I read that and it doesn't tell me anything because it refers to other paragraphs. All my sales are done by a regulated investment company, too.
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It doesn’t matter if your sales are done by a regulated investment company. Which retail investors are not?
__________________
Retired since summer 1999.
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12-03-2017, 08:58 AM
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#95
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Thinks s/he gets paid by the post
Join Date: Feb 2012
Location: Northern Ohio
Posts: 3,182
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Thanks for this discussion, I've resolved to call Vanguard Monday to get a DAF setup. I'm meeting with my CPA on the 13th (I was/am hoping the law is final by then) but JoeWras's comment about needing to start the process with Vanguard by the 15th makes me think I need to start this process now.
I've been gifting highly appreciate shares (currently working off a pile of $7 AAPL shares) and with the possible changes to picking which shares to sell (FIFO) I think I'll just send all the $7 shares into the DAF. Just means more ROTH conversions this year...
Again, great discussion so far!
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12-03-2017, 09:01 AM
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#96
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Full time employment: Posting here.
Join Date: Apr 2016
Location: warren
Posts: 935
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I was listening to Kudlow yesterday and he and his guest were very much against the FIFO rule. The guest (who's name escapes me) thought it was put in as a bargaining chip as something that could be given up in later negotiations on the bill.
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12-03-2017, 09:26 AM
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#97
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Thinks s/he gets paid by the post
Join Date: Dec 2016
Location: DC area
Posts: 2,495
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Quote:
Originally Posted by LOL!
If you are a family with one child over age 16 (no child tax credit) under current law you get 3 exemptions (3 x $4150) and a standard deduction of $13,000 for a total of $25,450.
Under the proposed law, you get a standard deduction of $24,000.
So your taxable income will increase by $1,450.
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You are missing the new "non-child dependent" tax credit. $500 in the Senate version, which is worth more than the tax on $1,450 in all but the highest brackets, and that is for just one dependent. It is not clear to me if this applies to taxpayer and spouse too, the $300 version in the House bill does. If the Senate rule is the same, it would be a $1500 tax credit in your scenario.
__________________
FI and Semi-ER March 24, 2017
Consulting to stay engaged
"All models are wrong, some are useful." - George Box
“There is always a well-known solution to every human problem: neat, plausible, and wrong.” - H.L. Mencken
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12-03-2017, 09:29 AM
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#98
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Sep 2012
Posts: 11,702
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Quote:
Originally Posted by mpeirce
Thanks for this discussion, I've resolved to call Vanguard Monday to get a DAF setup. I'm meeting with my CPA on the 13th (I was/am hoping the law is final by then) but JoeWras's comment about needing to start the process with Vanguard by the 15th makes me think I need to start this process now.
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Those dates are to be safe, and generally there isn't that much lag at other times of the year. VG and Fidelity Charitables get slammed in December. A new account would probably take priority, but who knows?
With VG Charitable, it is darn near automatic if you gift VG mutual funds. Anything else requires some human which could slow things down, especially during this year end flurry. I suspect the flurry may be more intense this year due to the proposed law.
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12-03-2017, 09:29 AM
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#99
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Recycles dryer sheets
Join Date: Mar 2008
Posts: 413
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Is there info how QDiv and LTCG will be taxed? Currently there is 0 tax up to the 15% bracket of taxable income (combined income-deductions).
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12-03-2017, 09:48 AM
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#100
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Recycles dryer sheets
Join Date: Jan 2006
Posts: 321
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It appears that the final senate bill has removed the Hatch amendment in sec 13611 on page 284 that originally combined the 401k/403b & 457 limits into one aggregate limit, so those who contribute to both should still be able to max both.
__________________
To endure the unbridled micromanagement of one's time on this earth, whether paid or unpaid, is to offer up one's soul to a paradigm of increasing tyranny, exploitation and indignity.
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