Salinas, CA: Tips For Saving Taxes On IRA Withdrawals: View From A Private Duty Caregiver
Salinas, CA: Tips For Saving Taxes On IRA Withdrawals: View From A Private Duty Caregiver Serving Carmel, Carmel Valley, Carmel-by-the-Sea, Gilroy, Gonzalez, Greenfield, Hollister, King City, Marina, Monterey, Pacific Grove, Pebble Beach, Salinas, San Juan Bautista, Seaside And Soledad California
Many seniors have multiple accounts for their retirement, 401K's, IRA's, Roth IRA's etc. It's hard to keep track of them all but an article in The New York Times reminds us of the important rule that you must start withdrawing from IRA's and 401Ks in the year in which you turn 70.5, or defer the withdrawal to April of the following year at the latest. Beware, however, of waiting until April of the following year because you can only do this once and, therefore, you will have two distributions to pay taxes on unless it's a Roth account (on which the taxes have already been paid). This could push you into a higher tax bracket. One tax advisor told the New York Times that since this is an election year, if you are turning 70.5 this year you might want to wait until after the November elections to see who wins, which could impact how the tax laws may change for 2013. It's already been announced that beginning next year, the 3.8% Medicare tax will be due on all capital gains, dividends and investment income for joint filers earning more than $250,000 so if you are taking a big distribution (IRA pay-outs are included in this calculation) it might be better to take it by the end of the year. You will also need to decide whether you are going to take one lump sum or spread it into quarterly or monthly payments. If this sounds too complicated, first, sit down with your banker. He or she will have charts showing what the minimum distributions are that you are required to take each year (they are based on your age and life expectancy). You can then bring this information to your accountant. He or she may have ideas on how to defer some taxes by taking more or less in a certain year. After you have this figured out, relax, and enjoy your retirement!
[http://www.nytimes.com/2012/02/12/business/yourtaxes/for-retirement-plan-withdrawals-tax-strategies-abound.html]
About Richard Kuehn & Family inHome Caregiving of Monterey:
After more than a decade of caregiving, both in a professional environment and for a 97 year old family member I was dissatisfied with service from local caregiving agencies. I became convinced of the need for a service which provides very personal assistance to elderly and founded Family inHome Caregiving serving the Monterey Peninsula. Please visit my blog where I talk about important senior issues at:
http://www.familyinhomecaregiving.com/Blog
Many seniors have multiple accounts for their retirement, 401K's, IRA's, Roth IRA's etc. It's hard to keep track of them all but an article in The New York Times reminds us of the important rule that you must start withdrawing from IRA's and 401Ks in the year in which you turn 70.5, or defer the withdrawal to April of the following year at the latest. Beware, however, of waiting until April of the following year because you can only do this once and, therefore, you will have two distributions to pay taxes on unless it's a Roth account (on which the taxes have already been paid). This could push you into a higher tax bracket. One tax advisor told the New York Times that since this is an election year, if you are turning 70.5 this year you might want to wait until after the November elections to see who wins, which could impact how the tax laws may change for 2013. It's already been announced that beginning next year, the 3.8% Medicare tax will be due on all capital gains, dividends and investment income for joint filers earning more than $250,000 so if you are taking a big distribution (IRA pay-outs are included in this calculation) it might be better to take it by the end of the year. You will also need to decide whether you are going to take one lump sum or spread it into quarterly or monthly payments. If this sounds too complicated, first, sit down with your banker. He or she will have charts showing what the minimum distributions are that you are required to take each year (they are based on your age and life expectancy). You can then bring this information to your accountant. He or she may have ideas on how to defer some taxes by taking more or less in a certain year. After you have this figured out, relax, and enjoy your retirement!
[http://www.nytimes.com/2012/02/12/business/yourtaxes/for-retirement-plan-withdrawals-tax-strategies-abound.html]
About Richard Kuehn & Family inHome Caregiving of Monterey:
After more than a decade of caregiving, both in a professional environment and for a 97 year old family member I was dissatisfied with service from local caregiving agencies. I became convinced of the need for a service which provides very personal assistance to elderly and founded Family inHome Caregiving serving the Monterey Peninsula. Please visit my blog where I talk about important senior issues at:
http://www.familyinhomecaregiving.com/Blog
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