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each year you are re-adjusted so if it was a one shot deal premiums are effected just that year . in 2018 the bracket for the first increase is 85,001.00
each year you are re-adjusted so if it was a one shot deal premiums are effected just that year . in 2018 the bracket for the first increase is 85,001.00
Is that for a single person? Do you know the first bracket increase for joint filers? I am working part time and will be on Medicare in January 2018 so am monitoring my income so as NOT to slip in the higher bracket.
For Dave: a tIRA and 401k are treated identically at tax time. To determine if the correct move is to roll over from a tIRA to a Roth now, or pay normal taxes on withdrawals later, you only have to run both scenarios in Tax Estimator, with expected incomes at current ages and at age 71, and see what nets you more. Sometimes it just makes sense to pull more out than you need pre 70.5 and put that extra in low tax munis or LTCG level dividend stocks.
It is more than just a little frustrating to work your whole life to be able to live well on say, $50k, and then because of your excellent saving abilities and frugality, find yourself at age 71, FORCED to take a $75k income and lose $10k of it to added taxes, and only net an extra $15k, simply because you believed entirely the general advice that you would be in a lower tax bracket later in retirement. It often is simply not true.
These last few years of employment I put nothing deferred in my 401k (except the company match, where I have no choice), because I already saved too much that way, so everything is post tax, and each year I roll it in to my Roth. I will always be in the current brackets I am in now or higher, so deferral is of little use to me.
So if my wife moves $6,500 from her IRA to her Roth this year that would be $6,500 of taxable income correct? That's pretty scary.
Well for 90% of us on here 170k for married couple is a pretty high threshold if you are retired,
unless you are withdrawing large sums of money out of your 401K. Seems like if you withdraw
reasonably a person should be ok. Everyone has to remember you got to save tax free so it is only
reasonable that you would have to pay taxes on withdrawal.
it is easy to get caught up in it if you sell long held assets ,especially real estate . we got caught up in it and tripped the max our 2nd year in retirement . the asset was sold before we retired or were on medicare . they go back two years so a real estate related sale pre retirement combined with our working income did the trick .
Consider a popular poster on here who is a retired California teacher and who is frequently posting and has shared his finances. As I recall they have a pension income of about 64K with no eligibility for SS. He considers that a modest comfortable amount. As has been noted several times and should be noted again if married to another California pensioner with a similar earning history and pension their joint income would be 128k about to become 130k with a possible COLA increase in future years of 3% which is closer to historical norms that income would quickly increase. If they have workplace deferred savings they could easily be pushing over 150K at RMD time. Not as unusual as some might think. On the other hand if married and the spouse didn't work and neither had SS then a very different ball game.
Marriage and the income and earning history and benefits of a spouse are a retirement deal maker or breaker in many cases so to have an IRA/401/403 or not?
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