Tax minimization calculator

[karen1972]

Is there a good tax calculator to figure out the right balance of tax harvesting vs. ROTH conversion to minimize taxes for the next decades.

ie I have about $200K in taxable gains and $650K in tax-deferred and trying to figure out how best to balance that, ACA credit, HSA contributions, etc.

[sengsational]

There are probably many such tax calculators out there. But they'd probably charge a high hourly fee. I doubt an automated calculator exists that will do what you want, though.

[Sunset]

You could take last years tax return.
Rename it.
load the renamed one into your last year tax software (it will be close enough).
Then try various combinations to see what you get.

If you are going for the ACA credit/subsidy, then from what folks say, that will be the big determining factor or limit.

The number of years you have to do this before RMD and SS makes a difference, as does how much you feel you should leave in the IRA/401K for future medical expenses and the harmlessness of small RMD's.

[Independent]

Various people here report that they've written their own. The number of variables is large enough that making something that's got all the options anyone might want is daunting. Something that looks at just my situation is more plausible, but of little use to anyone else.

I tried one. It didn't point in any clear direction other than Roth conversions when my marginal rate was low (yeah, no surprise). But, that was before ACA.

[omni550]

Quote:

Originally Posted by karen1972 Is there a good tax calculator to figure out the right balance of tax harvesting vs. ROTH conversion to minimize taxes for the next decades. ie I have about $200K in taxable gains and $650K in tax-deferred and trying to figure out how best to balance that, ACA credit, HSA contributions, etc.

Karen,

I've been seeking something similar (without the need to plan for ACA).

I found this one, but have not yet purchased access to it. So I cannot vouch for its usefulness. I do like that it's online and no software needs to be downloaded and updated. They are also adding a few more features soon that are currently in development.

https://maxifiplanner.com/

They are very responsive. I sent an email with some questions over a weekend and they responded within a few hours.

omni

[karen1972]

Not sure if anyone has any experience with i-ORP. Saw that from a similar posting today on reddit, guess I"m not alone looking for answers.

At this point looks like I may just have to give up the ACA subsidy and just bite the bullet or I'll end up paying massive taxes later in life. Of course the other option is to marry my BF of 8 years... that would give me a lot more room in the tax brackets.

[Likes_to_Lurk]

Quote:

Originally Posted by omni550 Karen, I've been seeking something similar (without the need to plan for ACA). I found this one, but have not yet purchased access to it. So I cannot vouch for its usefulness. I do like that it's online and no software needs to be downloaded and updated. They are also adding a few more features soon that are currently in development. https://maxifiplanner.com/ They are very responsive. I sent an email with some questions over a weekend and they responded within a few hours. omni

I used the desktop version of Maxifiplanner (EsPlanner) a few years ago. The desktop product is fairly sophisticated and I found it useful. The support staff was prompt and helpful in my experience. I have been meaning to check on the web version to model Roth conversions. Thanks for the reminder!!

[sengsational]

Quote:

Originally Posted by karen1972 Not sure if anyone has any experience with i-ORP. Saw that from a similar posting today on reddit, guess I"m not alone looking for answers.

I was going to say, before my earlier snarky post, that i-orp would be as close as you'd get. But I don't think it models capital gains, and that was part of your original post.

[sengsational]

Quote:

Originally Posted by omni550 https://maxifiplanner.com/

I don't know exactly how, but I bet that this is a lot like "ESPlanner". I had a copy of that, but I couldn't get it to work like I wanted it to, so returned it. ESPlanner was more of a Social Security optimizer. Not sure about this new flavor that Larry's got going.

[Scuba]

I’ve been looking for something like this as well. I was hoping there would be some all-inclusive tool that could guide us in how to optimize our after tax returns given the various options we have. It seems that everyone’s situation is somewhat unique so there aren’t many tools out there. Thanks for this post; I’ll be following it and checking out the suggestions.

[Winemaker]

I asked in another thread about the Retiree Portfolio Planner v18. I have used it but not sure if I used it correctly. After inputs, you can alter your outcomes by changing boxes.

The link below gives a bogle /wiki explanation, then follow the link. V18 has the new tax law as of 1/1/18.

https://www.bogleheads.org/wiki/Retiree_Portfolio_Model

[pb4uski]

I chose to prioritize Roth conversions over gain harvesting because I have only a small window between when I stopped working and when my pension and SS start to do Roth conversions at a low cost. Over the past 5 years I've converted ~$250k and paid ~8% in federal tax.


While I figure the opportunity to do capital gains at 15% or less will always be there, the reality is that I am doing a lot at 0% because we are currently living off of our taxable accounts and our taxable accounts should be much lower once SS starts.

[karen1972]

Quote:

Originally Posted by sengsational I don't know exactly how, but I bet that this is a lot like "ESPlanner". I had a copy of that, but I couldn't get it to work like I wanted it to, so returned it. ESPlanner was more of a Social Security optimizer. Not sure about this new flavor that Larry's got going.

Actually, from what I read they are very similar tools, ie ESPlanner was obsoleted and I saw posts where on their own posts they referred to both tools.

[karen1972]

Quote:

Originally Posted by pb4uski I chose to prioritize Roth conversions over gain harvesting because I have only a small window between when I stopped working and when my pension and SS start to do Roth conversions at a low cost. Over the past 5 years I've converted ~$250k and paid ~8% in federal tax. While I figure the opportunity to do capital gains at 15% or less will always be there, the reality is that I am doing a lot at 0% because we are currently living off of our taxable accounts and our taxable accounts should be much lower once SS starts.

I-ORP indicated that's what I should be doing.. it suggests $45K/year. (BTW, the advanced version did include cap gains details where I could put in cost) I'm still trying to do the math to be sure I'm not missing something as that means giving up any chance of ACA subsidy. I've been thinking that maybe as I'm still younger that's an acceptable cost as when you really need the subsidies is later when premiums start hitting $750-$1000/month.

[Curmudgeon]

Quote:

Originally Posted by sengsational I was going to say, before my earlier snarky post, that i-orp would be as close as you'd get. But I don't think it models capital gains, and that was part of your original post.

I think it does model cap gains; I say that because there is a place to enter the cost basis which you have in your taxable account. I don't think there's any reason to ask this unless it takes cap gains into account.
There are also fields to enter healthcare info (ACA and premium tax credit), so I think, nominally, it handles everything the OP mentions. How well it does these, I don't know as I have not played extensively.

[Jimmie]

I'm 3 years from FIRE. Used MaxiFi and can recommend it. Instead of doing annual renewal for 2018, i'm going to try Pralana to compare results, but waiting for the 2018 version to be published. MaxiFi is web-based tool, so all your data is stored in the cloud on their servers. With all the companies getting hacked nowadays, it something to consider. Pralana is Excel-based and data stays on PC. Just need to own Excel license for your PC.

[ShokWaveRider]

Turbo Tax does it for me.

[karen1972]

Quote:

Originally Posted by ShokWaveRider Turbo Tax does it for me.

Well Turbo tax can minimize taxes this year, but it doesn't help you figure out if you should be paying more taxes now to avoid a tax cliff 20 years from now unless I'm missing something.