Maynard
Confused about dryer sheets
Greetings to all like-minded souls. I retire in April at age 57, quickly pass to 58. I'll be 59 1/2 in October 2012.
I have a 401(k) and a cash balance defined benefit account. My employer shot themselves in the foot when they negotiated the minimum rate for interest credit on the CB, setting it at 5.27%. That rate can be renogotiated after I leave, but unless and until that happens, I'm leaving the CB money in place and I'll rely on the 401(k).
My plan allows for a split distribution, but only once. A penalty-free cash distribution can come to me, but the balance has to be rolled into an IRA. I need to withdraw enough for living expenses for 9 months each in 2011 and 2012. My conundrum is that the large amount I'll withdraw in 2011 will make my income and associated FIT bill very high, and the small amount I withdraw in 2012 will make the FIT bill small for that year.
Is there any way to "average" or levelize the income over the two year period? Can I still carry back to a prior tax year if my deductions in 2012 are greater than my tax liability? I believe that could happen due to the effect of rental R/E depreciation. Aside, I know there's no provision for income averaging in the tax code, that's my term.
Thanks for any help and let me know if I need to clarify any of that. I'm looking forward to joining you in the life of Reilly.
I have a 401(k) and a cash balance defined benefit account. My employer shot themselves in the foot when they negotiated the minimum rate for interest credit on the CB, setting it at 5.27%. That rate can be renogotiated after I leave, but unless and until that happens, I'm leaving the CB money in place and I'll rely on the 401(k).
My plan allows for a split distribution, but only once. A penalty-free cash distribution can come to me, but the balance has to be rolled into an IRA. I need to withdraw enough for living expenses for 9 months each in 2011 and 2012. My conundrum is that the large amount I'll withdraw in 2011 will make my income and associated FIT bill very high, and the small amount I withdraw in 2012 will make the FIT bill small for that year.
Is there any way to "average" or levelize the income over the two year period? Can I still carry back to a prior tax year if my deductions in 2012 are greater than my tax liability? I believe that could happen due to the effect of rental R/E depreciation. Aside, I know there's no provision for income averaging in the tax code, that's my term.
Thanks for any help and let me know if I need to clarify any of that. I'm looking forward to joining you in the life of Reilly.