walkinwood
Thinks s/he gets paid by the post
Am I missing any advantages/disadvantages in my thinking below?
Thanks in advance.
It is time to rebalance - my equity allocation has crossed my tolerance band.
Our ROTH accounts are 100% equity, our T-IRA accounts are 100% bond and the Taxable is a mix with sufficient equities to rebalance.
Reblance using ROTH funds
Advantages - No LTCG taxes
Disadvantages - Loss of tax free equity growth
Rebalance using Taxable funds
Advantages : Tax free equity growth in ROTH
Disadvantages : LTCG taxes in 15% bracket; More bonds means more taxable income. Possible loss of ACA subsidies.
Practically, I can rebalance in the ROTH now and when I know how much 0% LTCG headroom I have at the end of the year, I can sell equities in taxable (to the 0% threshold) & buy them back in ROTH. Thus using both accounts to rebalance.
Thanks in advance.
It is time to rebalance - my equity allocation has crossed my tolerance band.
Our ROTH accounts are 100% equity, our T-IRA accounts are 100% bond and the Taxable is a mix with sufficient equities to rebalance.
Reblance using ROTH funds
Advantages - No LTCG taxes
Disadvantages - Loss of tax free equity growth
Rebalance using Taxable funds
Advantages : Tax free equity growth in ROTH
Disadvantages : LTCG taxes in 15% bracket; More bonds means more taxable income. Possible loss of ACA subsidies.
Practically, I can rebalance in the ROTH now and when I know how much 0% LTCG headroom I have at the end of the year, I can sell equities in taxable (to the 0% threshold) & buy them back in ROTH. Thus using both accounts to rebalance.