When you are ready to retire, you probably will have some pension income, social security, taxable accounts, tax deferred accounts (401Ks, traditional IRAs, SEPs, etc.) and tax avoidance accounts (Roth IRAs, etc.). You will pay tax on the social security and pensions as they are paid to you, but on most, if not all, of the other accounts you can choose which to make withdrawals from. What should you take out first? See this article in Yahoo! Finance and Forbes.com by John Wasik for some help: http://finance.yahoo.com/news/three-step-plan-retirement-withdrawals-130900208.html This order list is a basic thing as a starting point: you should really look at your income each year in addition to amounts you need to withdraw (if you are over 70 1/2 you may have to take some of the tax deferred money each year.) It would be smart to set up a planning session with your tax preparer in the middle of the year to check your tax situation so you can be better informed about what makes sense. If you have the information when you have your taxes prepared, that is a great time to take a look. For financial, accounting and tax musings, You can count on [...]
IRS scam continues long after tax-filing season
So the fake IRS telephone threat scam has been working so well the scammers didn’t stop when tax season is over (it is apparently still profitable to run this out of season.) See this article in USAToday by Herb Weisbaum, a CNBC contributor, for more details: http://www.usatoday.com/story/money/business/2014/06/15/cnbc-tax-scams-irs/10438269/ Just remember that usually the only time the IRS will call you is if you are being audited and they want to schedule an appointment. They NEVER ask for money over the phone (you will get a letter requesting payment with a reasonable time to pay it.) and ordinary no one is going to take you to jail over income tax ‘errors’ – they usually just want the additional money due (kind of like the scammers.) For financial, accounting and tax musings, You can count on us to count for you! Email: bstonercpa@sbcglobal.net Phone: 818-317-6035 Website: www.briantstonercpa.com Android and the IPhone: Has been Featured On https://twitter.com/bstonercpa
CPA Financial Musings: Bad move? Retirement savers flock to cash
There are indications that investors are becoming extremely gun-shy today when it comes to any risk in their savings and retirement and have a very high concentration in cash. The research division of State Street Corp, a large asset manager, conducted a survey and found high concentrations of cash and cash-equivalents worldwide at all asset levels. See this article in Marketwatch (from the Wall Street Journal) by Anne Tergesen for more details: http://blogs.marketwatch.com/encore/2014/06/12/bad-move-retirement-savers-flock-to-cash/ Based on this survey, people appear to be scared of the markets (after the last 12 years, it is understandable) but safety in cash may be a false hope if inflation rears its ugly head. Better to asset allocate across all classes and keep a smaller percentage in cash. The mattress in the corner (where you hide your cash) can still catch fire! For financial, accounting and tax musings, You can count on us to count for you! Email: bstonercpa@sbcglobal.net Phone: 818-317-6035 Website: www.briantstonercpa.com Android and the IPhone: Has been Featured On https://twitter.com/bstonercpa