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Old 01-24-2018, 01:20 PM
 
Location: We_tside PNW (Columbia Gorge) / CO / SA TX / Thailand
22,622 posts, read 39,986,663 times
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Quote:
Originally Posted by N.Cal View Post
She does know that they will take about 40% of that right off the top for taxes, right? So she won't get near close to a year.
thus... good opportunity to 'get-creative' / plan to better utilize the next few yrs.

I used a Section 179 to defer that 40% tax into appreciable business assets. (for future income generation)
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Old 01-24-2018, 02:17 PM
 
6,625 posts, read 3,754,399 times
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Quote:
Originally Posted by twins4lynn View Post
Aunt should continue working until she is laid off and receives her severance. Then she should get another job ($10 hour or whatever is available). Full time is best but pt if thatís all thatís available. Makes NO SENSE to leave her job now and loose her severance, for a $10/hr job.

The odds are that Grandma should not return home after the knee replacement. If she is unable to live independently now without help from family members, the help required will only increase after the knee replacement. Aunt should NOT push to have grandma return home after the knee replacement to be cared for by her (but I suspect this is what aunt will do, although it is not in aunt or grandmaís best interest).
Absolutely. In my response post I said that if it were me, and no jobs to speak of in the area, I'd move. Otherwise, I'd get a job locally at the highest pay I could.

BUT all that is AFTER she does the common sense thing of staying at her current job until laid off, so she gets the severance (and continues getting that salary). That goes w/o saying.
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Old 01-24-2018, 02:25 PM
 
6,625 posts, read 3,754,399 times
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Quote:
Originally Posted by N.Cal View Post
She does know that they will take about 40% of that right off the top for taxes, right? So she won't get near close to a year.
I don't think that much. I've read that it's taxed like ordinary income. In fact, the employer may withhold the tax before issuing the check. 20 or 25% maybe. Don't know if employee or employer pays the FICA.

And of course, taxes for the wealthy have decreased starting in 2018, so that 40% for the wealthy should be knocked down to, what...21%?

I read that it's taxed like ordinary income.
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Old 01-24-2018, 02:39 PM
 
5,397 posts, read 6,540,598 times
Reputation: 10472
Serious

Your aunt has made her decision that family comes first (for good or bad that is how she is playing it) and that decision must be right for HER. So it looks like she will work whatever time at her current job, then take the severance. Then who knows what job she will get next but she will probably live lean until she reaches 62.

However once your Grandma is in a facility (as she might well be after the knee/hip replacement) things may change for the better.

What does your aunt need from you? have you asked? other than that leave her be to go her best way.

I hate it when know it all younguns try to tell me what to do.
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Old 01-24-2018, 02:51 PM
 
Location: Mount Airy, Maryland
10,465 posts, read 5,935,374 times
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I'm not sure she needs to move to get a job. Sorry if I missed it but with the scenario you laid out in the OP she may have enough money already. And moving given her family responsibility does not appear to be an option. Seems to me the best thing for her to do is take a $10/hour part time job, live off the severance (is it a lump sum or pay check variety?) and then see where she is. Do you have any idea if she really needs another full time job?
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Old 01-24-2018, 02:51 PM
 
13,936 posts, read 7,422,661 times
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Quote:
Originally Posted by N.Cal View Post
She does know that they will take about 40% of that right off the top for taxes, right? So she won't get near close to a year.
Nope. Tennessee doesn't have a state income tax. The cable companies pay lousy. That's all 22% to 24% bracket money. 6.2% for FICA and 1.45% for Medicare. About 30% will come off the top. It won't look all that different from a year of take home pay. In a paid-for house, you can stretch that a couple of years without having to eat rice & beans.
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Old 01-24-2018, 03:04 PM
 
13,936 posts, read 7,422,661 times
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Quote:
Originally Posted by bpollen View Post
What "elderly woman" are you speaking of? The 56 year old? LOL. 56 is not old. Not by a longshot.
The elderly woman is grandma. The aunt's mother. The aunt is the primary caregiver.

The problem here is health insurance. At age 56, you can't assume ACA will be there until age 65. With assets and Tennessee not opting into Medicaid expansion, Medicaid isn't an option since you have to be destitute to qualify.
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Old 01-24-2018, 03:39 PM
 
Location: Lakewood OH
21,697 posts, read 23,676,966 times
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Quote:
Originally Posted by biscuitmom View Post
OP seems to have a multitude of older relatives about whom IMO he knows way too much about their finances.
Yeah, now which ending would you prefer?
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Old 01-24-2018, 04:05 PM
 
Location: Mid-Atlantic
25,057 posts, read 23,942,176 times
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Quote:
Originally Posted by Serious Conversation View Post
She has Crohn's and other health issues. She can't access her savings without penalty yet. COBRA will eat her alive.

Obviously having no or minimal income at 56, with a dependent elderly mother and basically having to act as a mom to a 5 year old, is not an ideal situation.
Crohn's disease is a life and soul sucking disorder. You can never just leave the house on a whim.

I don't think she's going to move. There are too many obstacles. She's a widow, so she can collect SS at 60.
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Old 01-24-2018, 04:07 PM
 
3,351 posts, read 3,052,428 times
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Quote:
Originally Posted by bpollen View Post
I don't think that much. I've read that it's taxed like ordinary income. In fact, the employer may withhold the tax before issuing the check. 20 or 25% maybe. Don't know if employee or employer pays the FICA.

And of course, taxes for the wealthy have decreased starting in 2018, so that 40% for the wealthy should be knocked down to, what...21%?

I read that it's taxed like ordinary income.
When I was thinking about not relocating and taking the buyout, it was definitely going to be taxed as excess and not as ordinary income.
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