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Biden is going to grab a big chunk of that money when he brought back the inheritance tax that Trump did away with . The government will get very rich taking what should go to the heirs.
Traditional IRA withdrawals are taxed as regular income. The boomers who are leaving their wealth to their children in the coming decades all started with traditional IRAs. The Roths came much later so represent less of a boomer's portfolio.
We've been converting every year since I became semi-retired and my income began to fall. I also rolled some pension cash into Roth.
529, healthcare savings accounts (HSA's), and Roth's are the best ways to save the grow wealth we've found.
We've also set up 2 trust for our heir, and are gifting the max annually. Of course, we have a will and living will too. And, we moved to FLA. The gov't is going to get bread crumbs from our wealth transfer.
The gov't is going to get bread crumbs from our wealth transfer.
I've said this before, but I wouldn't mind the government getting a certain percentage of our earnings so much if so much of it wasn't going places that I strongly disapprove of.
For that reason, we are now doing whatever we can do legally to limit the government's share and 90% of our estate will go to one or more charities after we die. I would much rather support a cause I believe in than those causes I don't!
We've been converting every year since I became semi-retired and my income began to fall. I also rolled some pension cash into Roth.
529, healthcare savings accounts (HSA's), and Roth's are the best ways to save the grow wealth we've found.
We've also set up 2 trust for our heir, and are gifting the max annually. Of course, we have a will and living will too. And, we moved to FLA. The gov't is going to get bread crumbs from our wealth transfer.
That is a good plan. Unfortunately, timing didn't work out for me to be able to transfer to Roth without incurring extra income tax myself.
Excerpts from above linked article, my italics and bold:
[i]At the end of this year’s first quarter, Americans age 70 and above had a net worth of nearly $35 trillion, according to Federal Reserve data. That amounts to 27% of all U.S. wealth, up from 20% three decades ago. Their wealth is equal to 157% of U.S. gross domestic product, more than double the proportion 30 years ago, federal data show.
Now they have started parceling it out to their heirs and others, unleashing a torrent of economic activity including buying homes, starting businesses and giving to charity. [snip]
Older generations will hand down some $70 trillion between 2018 and 2042, according to research and consulting firm Cerulli Associates. Roughly $61 trillion will go to heirs—increasingly millennials and Generation Xers—with the balance going to philanthropy. [snip]
This totally explains why the democrats want to start taxing inheritances. They should leave that money alone, it has already been taxed several times.
You are disgusting. You have no right to other’s money. Much of the money has already been taxed. What makes you so high and mighty that you think you are entitled to more? You have an entitlement mentality. Earn you own keep.
And under Trump, the IRA inheritance rules were changed so the person inheriting it has to withdraw all the money within 10 years... adding to their earned income for each of those years. That will put many into a much higher income tax bracket.
Yeah, Trump’s giant death tax is going to come as a surprise to many. Under the old rules, you could have a pretty significant balance and if the RMD was calculated on a 25+ year expected additional life span, it was still pretty easy to minimize taxes on it. A 10 year draw down, not so much.
That's what some Democrats are claiming is inequitable that blacks have less inheritance money than whites to transfer to their own. So inheritance contributes to the wealth gap along racial lines.
I think actually by the time a person receives inheritance, he is already middle aged, past the age of innovation. That money will only help toward a more comfortable retirement or pay off debts. That's not an investment.
Family money makes the most difference for young people when there is a future to invest in. And I find Asians do that very well.
Traditional IRA withdrawals are taxed as regular income. The boomers who are leaving their wealth to their children in the coming decades all started with traditional IRAs. The Roths came much later so represent less of a boomer's portfolio.
The traditional Roth IRA's have been around for quite a while. They can change the traditional to a Roth and many have.
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