Taxes play a significant role in any retirement plan. Before retirement, you'll want to maximize the benefits of tax-deferred and tax-free growth. During retirement, your focus will be on maximizing the after-tax value of your income. Finally, you may desire to efficiently pass along some assets to your heirs.
Although gift tax is very straightforward, those with high asset levels need to follow the rules or risk paying tax unnecessarily.
Despite all the changes in the estate tax, the method for calculating the value of your estate has remained consistent. Do you know that many accounts that are not subject to income tax might be subject to estate tax?
Required minimum distributions (RMDs) were suspended for 2009. However, those turning 70 1/2 during 2008 must still take their first distribution by April 1, 2009. Learn the occasionally counter-intuitive effects of this quickly-passed legislation.
401K to IRA rollovers are a fairly straightforward process as long as you make it clear of your intentions. However, if you take a distribution and then decide to do an IRA rollover, your job jut got harder thanks to mandatory withholding. Learn how to avoid the 20% mandatory withholding.
Saving for retirement during your working career is a necessary step to achieve financial independence. Take advantage of all the tax breaks available to you by saving for retirement.
Your modified adjusted gross income, or MAGI, influences many of your retirement planning options, including which retirement plans you can contribute to, how much you may contribute, and whether you can deduct your contribution. Make sure you have a solid understanding of your MAGI before finalizing your annual contributions.
For most people, determining your filing status for tax purposes is simple. Are you like most people?
Understand how to calculate capital gains and losses and how they are taxed inside and outside of retirement plans.
As a rule, early distributions from retirement plans are subject to a 10 penalty tax. One notable exception to the penalty is taking substantially equal periodic payments (SEPP). Learn the advantages and disadvantages to this approach.
Roth IRA. Traditional IRA. They're both good options. Yet, which one to choose? Rather than simply going with gut feel, wouldn't it be nice to run the numbers? This calculator gives you the ability to enter your personal assumptions and see what makes the most sense for you.
After you reach 70 1/2, you must begin taking distributions from your 401(k) and regular IRA. The penalty for not doing so (50% of the amount you should have distributed) is so high that there is no appropriate strategy that involves not taking these payments. Here's an easy way to calculate what you must distribute, ensuring you never pay that penalty.
Typically, you must wait until you are at least age 59 1/2 in order to access retirement funds (such as your 401(k), IRA, or Roth IRA) without paying a 10% penalty tax. However, there are a few exceptions. But, even if you qualify for an exception, should you take your money early? Learn the true implications of early retirement plan distributions.
Did you know that many retirees move to Florida for reasons other than the sunshine? It turns out that Florida's tax climate is as friendly to your wallet as their warm air is to your bones. Learn how each state ranks on its tax policies towards retirees including sales tax, property tax, cigarette tax, certain retirement benefits, and Social Security.
Estate taxes are collected upon the ultimate demise of some individuals. These death taxes, as they are sometimes known, can have very high rates. Will estate taxes affect you? Read this article to find out and learn how to plan for the possibility. After all, the estate tax laws are changing all the time and neither you nor your heirs want to be caught off guard on this one.
Learn how a tax deferred plan can lower your current and future taxes.
Learn how a tax free plan can lower your future taxes, potentially significantly.
