If you contributed too much to your 401k you may end up owing a penalty. Depending on when you realize that you have contributed too much, you may be able to reverse it. If you do it before the deadline you can avoid the penalty entirely. In this article I’ll explain what you need to …
A 702(j) retirement plan really isn’t a “retirement plan” at all. It’s a cash value life insurance policy sold as a retirement plan. You may have heard the spiel. The promise of a 702(j) plan is tax-free retirement income. It is possible to access the cash value in a life insurance policy tax-free, but there …
Tax-gain harvesting may seem counter-intuitive, but it can be an effective way to reduce your total tax burden in retirement. Mindful tax planning is one of the easiest ways to improve your finances in retirement. What makes that true is the fact that current tax rates are known, so any time you make a decision …
If you hold a portfolio that contains stocks or equity funds, whether they are mutual funds or ETFs, then chances are you receive dividends. You probably reinvest at least a portion of them. But are reinvested dividends taxable? Reinvested dividends are generally taxable like any other dividend but that doesn’t necessarily mean you’ll incur a …
This article covers the mechanics of paying Roth conversion taxes. Specifically, we will look at the source of money that you use to pay the tax bill due on the conversion, as this could actually impact the amount you owe on the conversion. If you are under 59 & 1/2, paying taxes with money from …
The idea for this article comes from a question submitted by a reader. I’ve copied the question below, and omitted the names to protect the innocent. (No animals were harmed in the creation of this article.) The question: Let me start by saying, I totally enjoy reading your articles/post! Do you have any information on …
Yes, but with a nod to Paul Harvey, there is a “rest of the story”. It isn’t as simple as adding your benefit check to your taxable income and paying taxes at your marginal rate. Social Security retirement benefits are an important part of retirement. For about 62% of retirees, Social Security represents at least …
Being self-employed certainly has its perks; for the most part, you get to dictate your own schedule and enjoy a large amount of independence. At the same time, there are some potential drawbacks to being your own boss. One of the biggest headaches you might encounter as you transition into a self-employed or freelancing career …
