Comments on: Lots of answers about taxes and retirement from David Bergstein, CPA

By: Brian

Brian — Mon, 15 Dec 2008 21:06:16 +0000

I will be graduating college in 2 days, and my company will be converting me from an employee to an independant contractor begining January 1st. Currently I pay my father for my portion of our family-plan cell phone, family plan health and car insurance.

My question is, should I have my company pay our family LLC and file as an employee of that OR should I file directly as an independant contractor and somehow deduct the portions of expenses I pay (insurance and cell phone)???

By: Bonni Rice

Bonni Rice — Wed, 19 Mar 2008 21:50:29 +0000

My husband and I have bought new light weight bikes specificaly for riding in the MS150 in our state. We have other bikes used for trail riding. We want to know if we can deduct a portion of these new bikes that we use just for this volunteer/raise money organization??

By: UFC Retirement: Traditional vs. Roth IRA

UFC Retirement: Traditional vs. Roth IRA — Mon, 19 Nov 2007 17:08:24 +0000

[...] great article on I Will Teach You To Be Rich about retirement savings and IRA plans including a Q&A with a [...]

By: Rob

Rob — Mon, 23 Apr 2007 20:07:03 +0000

What a great article. If it’s not too late for questions, here’s two. First, what shouild I look for in a good CPA for tax advice? Second, I am excluded from participating in my company’s 401k due to safe harbor. I am the son of one of the owners, with no ownership interest. By virtue of same-last-name, and since the two owners hold the biggest share of the 401k pool, my brother and I can no longer contribute. What alternative tax-deferred strategies would you suggest looking at? Thanks!

By: Sara

Sara — Tue, 17 Apr 2007 16:38:00 +0000

Don’t forget (especially the poster in #15) that if you fully fund your 401(K), you might be able to lower your income to the point where you are eligible to contribute the full amount to your Roth IRA. Especially if you are on the borderline.

By: James

James — Tue, 17 Apr 2007 01:36:33 +0000

Re: 17

1. Wow there are lots of Jameses…

2. I see your point. And I agree that the wording used in the comment in question (and elsewhere…) was quite vague, thus causing this confusion.

Looking back I see that you are correct in what he was referring to, but then that’s the funny thing about hindsight. The phrase “tax-deferred” would’ve made it instantly clear (at least to me).

By: James L.

James L. — Mon, 16 Apr 2007 19:04:54 +0000

Re:Post 14 and 15.

I think much of the confusion is in the terminology. Traditional IRAs, like 401(k) plans, do *grow* tax-free, even though those earning are taxed when withdrawn. These kinds of investment vehicles are generally referred to as “tax-deferred” since taxes on earning are deferred until they are withdrawn. While not quite as good as the tax-free Roth IRA, tax-deferred accounts are still much preferable to fully taxable accounts, where taxes are taken out every year.

By: jjok

jjok — Mon, 16 Apr 2007 16:43:26 +0000

Wife and I are borderline within the requirements making us eligible for a Roth contribution…..which we did make a full one for each of us in 05 and 06. But 07 is gonna be tough.

So questions I have….

1. Is the 2010 roth rollover rule a good move for younger folks like us? (33 yo). It seems it would be.

2. Can we rollover our old 401K’s from other employers into an IRA, and then do the rollover into our Roth in 2010?

Any ideas?

Thanks

By: James G.

James G. — Sun, 15 Apr 2007 00:22:01 +0000

James from post #14, I believe that David is refering to a form 8606 that you can file to keep track of what you contributed so that later you don’t pay taxes again on your contributions (gains will be taxed of course) Ric Edelman has a page on this: http://www.ricedelman.com/planning/taxes/rule77.asp

By: James

James — Fri, 13 Apr 2007 20:10:44 +0000

David,

I think you are either being very vague or are incorrect on some matters…either way, the end result is potential confusion to readers.

In a traditional IRA, distributions from that are taxed. And, as far as I read it, they are *always* taxed. Therefore, the investment did NOT grow tax free.

That’s the entire basis for why a Roth IRA can be considered “better”…because traditional IRA gains are taxed but (at least as of now) Roth IRA gains are tax free.