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Clearly it would be fraudulent if you didn’t incur hardships inline with the withdrawals
I wouldn’t do it because my 401k plan is great and I have zero dollars in IRAs partially because it would mess up my annual backdooring of Roth monies
Clearly it would be fraudulent if you didn’t incur hardships inline with the withdrawals
I wouldn’t do it because my 401k plan is great and I have zero dollars in IRAs partially because it would mess up my annual backdooring of Roth monies
I wouldn’t do it either .. I only have one years worth of 401k .... I cleaned out the 401k when I retired and put it in my ira ....but since I still work one day a week or rather I did before being put on hold , I qualified for the matching so I just stuck my whole check in each week.
The irony is unemployment pays me 2x what I made for my one day now ..it is a crazy structure ....I likely have at least a month or 2 left before I can resume what I did for them
That’s another consideration. How many people are really going to even know about this? How many Americans actually even have 100k saved? Of those who do, how many are willing to do this kind of fraud in a crisis for their own gain? It’s a subset of a subset of a subset. The audit risk in dollar terms is super small.
Technically, most of the return is on the honor system without audits. If I have a schedule c business and put $5,000 of depreciable assets and get year 1 bonus, it’s not like the IRS gathered my proof for them. Or if I claim medical deductions. Do they know those expenses are real yet? No.
I’ll do my part and raise it up the flagpole to my IRS agents~ The LB&I division is in contact with the national office regularly.
That’s another consideration. How many people are really going to even know about this? How many Americans actually even have 100k saved? Of those who do, how many are willing to do this kind of fraud in a crisis for their own gain? It’s a subset of a subset of a subset. The audit risk in dollar terms is super small.
Technically, most of the return is on the honor system without audits. If I have a schedule c business and put $5,000 of depreciable assets and get year 1 bonus, it’s not like the IRS gathered my proof for them. Or if I claim medical deductions. Do they know those expenses are real yet? No.
I’ll do my part and raise it up the flagpole to my IRS agents~ The LB&I division is in contact with the national office regularly.
When you get down to it most people don’t even know what their 401k is even invested in so they are not going to come up with schemes , it will only be the ones who have an interest and a reason who figure these things out .
At one time We could pay back social security all the money we got and if we were taxed we could take 7 years of money ,give it back And take a huge income deduction . Then refile at 70 for the max ..
The problem was it wiped out all your income and whatever was left over was lost as you can’t carry over a negative reduction
Then once again some shrewd people realized you can get free Roth conversions ....just use up the negative income on the conversions ...so not only did you refile for more social security but you got a free Roth conversion ...once it became popular they killed that ability ....so you will always have those who take an interest find a way to do something that something wasn’t designed to do
Which is why...if you've figured out an unintended "work around"....keep you mouth shut.
Otherwise it's like spreading the word about a great, quaint, cozy restaurant you've found. Now everyone is coming...and you can't even get a table anymore. Well, that's your (and the other diners) own fault.....for not just letting others stumble onto it like you did. If they find it, they find it. One or two more people. Fine. But keep running your trap and you'll have everybody and their mother there.
Which is why...if you've figured out an unintended "work around"....keep you mouth shut.
Otherwise it's like spreading the word about this great, quaint, cozy restaurant you've found. Now everyone is coming...and you can't even get a table anymore. Well, that's your own fault.
In my case irrelevant , not something I would do nor is this ploy to get money out of the 401k and rolled over playing by the irs rules ....they may not catch it but that does mean just because you can get away with something you should
^^ I know....I was just commenting in general about how something that only a few people might quietly do can get attention. And then that avenue is closed.
^^ I know....I was just commenting in general about how something that only a few people might quietly do can get attention. And then that avenue is closed.
It happens all the time ....that is what happened with paying back years of ss
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