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  • Large 7 digit IRA

    Saved for 45 years to build this up and now my kids will have our govt take a bigger bite of this apple than what the law originally allowed
    Nothing else but to make larger conversions and spend/gift excessive distributions
    Luckily in Fla my effective tax rate on 300-400k will be 18-20%

  • #2
    While I, too, am not enthusiastic about aspects of the Secure Act, definitely a 0.1% problem for which most Americans would be happy to trade places with you. Or your kids, for that matter.

    Comment


    • #3
      congrats on your success. If you don't want the government to take a bigger bite, please give some to me

      On a more serious note, if you want to keep more money out of the hands of the government based on today's laws, set up 529s for your kids (if they haven't gone to school) or grandkids (if any). Or you can set up the 529 with you as the beneficiary and then change the beneficiary to a grandchild when you have one.

      Or you can just donate the money in your IRA to a charity of your choosing and then the government won't get that money

      Comment


      • #4
        Originally posted by Kennyt7 View Post
        Saved for 45 years to build this up and now my kids will have our govt take a bigger bite of this apple than what the law originally allowed
        Nothing else but to make larger conversions and spend/gift excessive distributions
        Luckily in Fla my effective tax rate on 300-400k will be 18-20%
        My spouse now has revised her withdrawal plan. Spend her's on "whatever", once i get any severe symptoms start dipping into the bucket for really expensive travel and spend like crap. I am still responsible for paying the tax and filing the forms. Division of labor, I need to make sure that sucker is growing enough to keep pace with her spending. Forget the 4% crap I have been babbling about. Told the kids already. Mom is spending it, make room for Dad if I outlive her.
        I am encouraged by their response. Good luck Dad. Geez. Secure has made me very insecure.

        Comment


        • #5
          Originally posted by Kennyt7 View Post
          Saved for 45 years to build this up and now my kids will have our govt take a bigger bite of this apple than what the law originally allowed
          Nothing else but to make larger conversions and spend/gift excessive distributions
          Luckily in Fla my effective tax rate on 300-400k will be 18-20%
          dont quite need the humble brag but i get it. im sure your kids will be fine with multiple MM minus their marginal rate.

          Comment


          • #6
            I understand that this is a change for the worse since before the secure act, but forget about first world problems, this is more like 1%er problems. “I make so much money that I’m in a high tax bracket and my current financial situation is so stable I don’t really need the money I inherited so I would prefer to leave it in an IRA for years however I’m forced to withdraw it over 10 years and because of my aforementioned high tax bracket I’m forced to pay more in taxes on the money I didn’t earn in the first place.”

            There are worse financial situations to be in.

            Comment


            • #7
              Originally posted by JBME View Post
              congrats on your success. If you don't want the government to take a bigger bite, please give some to me

              On a more serious note, if you want to keep more money out of the hands of the government based on today's laws, set up 529s for your kids (if they haven't gone to school) or grandkids (if any). Or you can set up the 529 with you as the beneficiary and then change the beneficiary to a grandchild when you have one.

              Or you can just donate the money in your IRA to a charity of your choosing and then the government won't get that money
              Of course you'll have to pay regular income taxes on the IRA withdrawals in order to fund the 529's...

              Comment


              • #8
                obviously most, like 90% of inherited IRAS, are liquidated in 10 years but most professionals have most of their wealth in their pension plans
                if I can live a very long life it will mitigate the problem significantly
                JUST discovered that when you are taking RMDS you have to take them completely before doing any Roth conversions
                luckily we have three kids-no matter what they will have a higher tax bracket than ours now

                Comment


                • #9
                  The only thing I resent more than the SECURE act is those who feel compelled to diminish concerns about the SECURE act as humble brags, first world problems, 1% problems, or a problem they'd like to have. This forum, like Bogleheads and countless others, is for those who have been successful and want to minimize taxes while maximizing wealth. Frustration with the SECURE act is wholly justified in that it changes the rules long after the game has been played and there are few opportunities to mitigate the impact. It is fundamentally a money grab and degrades the sense of Justice and fairness taxpayers have in their government.

                  The answer is Roth conversions, QCDs, and possible CRTs or life insurance. No one yet knows what will be best.

                  Comment


                  • #10
                    Originally posted by Kennyt7 View Post
                    obviously most, like 90% of inherited IRAS, are liquidated in 10 years but most professionals have most of their wealth in their pension plans
                    if I can live a very long life it will mitigate the problem significantly
                    JUST discovered that when you are taking RMDS you have to take them completely before doing any Roth conversions
                    luckily we have three kids-no matter what they will have a higher tax bracket than ours now
                    This has been describe:

                    https://www.forbes.com/sites/leonlab.../#7a83e96839fb

                    My father had actually been doing this since 2010 as a retiree when Roth conversions were first allowed, taking advantage of his low tax bracket while lowering his RMD over time. You can continue with Roth conversions even after RMDs start. He recently passed away but upon his death my mother inherited spousal IRAs that were 80:20 Roth:traditional. Given enough time, it is possible to improve to a more favorable ratio.

                    Comment


                    • #11
                      If you are inclined to own income producing real estate you may want to consider using cost segregation to be able to take a large amount out, purchase apartments or other income real estate and avoid/delay the taxes and avoid the RMDs. I'm doing this successfully last year and this year. You have to get it done by 2022 as the tax law will start to "sunset".

                      Comment


                      • #12
                        Originally posted by FIREshrink View Post
                        The only thing I resent more than the SECURE act is those who feel compelled to diminish concerns about the SECURE act as humble brags, first world problems, 1% problems, or a problem they'd like to have. This forum, like Bogleheads and countless others, is for those who have been successful and want to minimize taxes while maximizing wealth. Frustration with the SECURE act is wholly justified in that it changes the rules long after the game has been played and there are few opportunities to mitigate the impact. It is fundamentally a money grab and degrades the sense of Justice and fairness taxpayers have in their government.

                        The answer is Roth conversions, QCDs, and possible CRTs or life insurance. No one yet knows what will be best.
                        if you knew then what you know now, what would you have done differently?

                        Comment


                        • #13
                          Originally posted by FIREshrink View Post
                          The only thing I resent more than the SECURE act is those who feel compelled to diminish concerns about the SECURE act as humble brags, first world problems, 1% problems, or a problem they'd like to have. This forum, like Bogleheads and countless others, is for those who have been successful and want to minimize taxes while maximizing wealth. Frustration with the SECURE act is wholly justified in that it changes the rules long after the game has been played and there are few opportunities to mitigate the impact. It is fundamentally a money grab and degrades the sense of Justice and fairness taxpayers have in their government.

                          The answer is Roth conversions, QCDs, and possible CRTs or life insurance. No one yet knows what will be best.
                          The secure act has not affected YOUR ability to minimize your taxes or maximize YOUR wealth. Not one little bit. Not 1/10 of one percent has it affected those things. It has increased the taxes that your kids pay on their inheritance over a course of 10 years, and only on the inheritance that has not yet been taxed at any point.

                          Of course it is a money grab. I am as anti-taxation as most. But I have a hard time being outraged about this one.

                          Comment


                          • #14
                            Originally posted by jacoavlu View Post

                            if you knew then what you know now, what would you have done differently?
                            I am actively reconsidering how much I defer pre-tax; and actively reallocating aggressive as opposed to conservative investments between Roth, pre-tax, and taxable investments. Yeah, future taxation actually impacts these decisions.

                            Comment


                            • #15
                              Originally posted by abds View Post

                              The secure act has not affected YOUR ability to minimize your taxes or maximize YOUR wealth. Not one little bit. Not 1/10 of one percent has it affected those things. It has increased the taxes that your kids pay on their inheritance over a course of 10 years, and only on the inheritance that has not yet been taxed at any point.

                              Of course it is a money grab. I am as anti-taxation as most. But I have a hard time being outraged about this one.
                              You do not understand the concept of family wealth. You are the politicians' favorite kind of taxpayer.

                              Comment

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