Hi all,
I've got new questions about my portfolio due to a new avenue for tax-advantaged investing opening up for me. Basic info below, then the questions! Thanks in advance!
Emergency fund: Yes
Debt: ~$470K 30-year mortgage at 3.15%, $14K car payment at 5%
Tax Filing Status: Married Filing Jointly
(Wife and I are newly married--we invest separately, so the below are just my numbers)
Tax Rate: 22% Federal, ? % State
Income: $72K/year
State of Residence: IL
Age: 38
Asset allocation / Current Portfolio*:
Total portfolio is ~$240K
90% stocks / 10% bonds
International allocation: 18% of stocks
Taxable
9.8% Fidelity Total Stock (FSKAX)
18% Fidelity Total International Index (FTIHX)
Roth IRA
50.00% Fidelity 500 Index (FXAIX)
12.20% Fidelity Extended Market (FSMAX)
10.00% Fidelity Total Bond Index (FTBFX)
Contributions
I invest ~14K per year, maxing out the Roth each year and putting the rest in the taxable
*with the help from some Bogleheads in years past, my portfolio was arranged between the Roth and taxable to avoid potential wash sale risk.
_______________________________________________________________
Questions:
Background:
- I am a small business owner (LLC, 5 members). We have no retirement benefits as a company and don't plan to.
- We have recently decided to split our compensation 50/50 between W2 and LLC distributions for tax savings purposes. We were previously paid 100% W2. Because of this change, my tax accountant says I can open a SEP as "Sole Proprietor / Schedule C", and thus have a new tax-advantaged investing avenue.
Questions:
- Is my tax guy correct? Is a SEP the best option here? Can I do a solo 401K in this situation? Feeling over my head on how this all works...
- Given how my allocation is already split between two accounts which are structured to avoid wash sale penalties, I'm unsure what to invest in in a new third account. Do I leave the taxable account as it is but stop contributing to it for now, or cash it out and put that money in the SEP? Obviously will pay a lot of taxes on that.
I've got new questions about my portfolio due to a new avenue for tax-advantaged investing opening up for me. Basic info below, then the questions! Thanks in advance!
Emergency fund: Yes
Debt: ~$470K 30-year mortgage at 3.15%, $14K car payment at 5%
Tax Filing Status: Married Filing Jointly
(Wife and I are newly married--we invest separately, so the below are just my numbers)
Tax Rate: 22% Federal, ? % State
Income: $72K/year
State of Residence: IL
Age: 38
Asset allocation / Current Portfolio*:
Total portfolio is ~$240K
90% stocks / 10% bonds
International allocation: 18% of stocks
Taxable
9.8% Fidelity Total Stock (FSKAX)
18% Fidelity Total International Index (FTIHX)
Roth IRA
50.00% Fidelity 500 Index (FXAIX)
12.20% Fidelity Extended Market (FSMAX)
10.00% Fidelity Total Bond Index (FTBFX)
Contributions
I invest ~14K per year, maxing out the Roth each year and putting the rest in the taxable
*with the help from some Bogleheads in years past, my portfolio was arranged between the Roth and taxable to avoid potential wash sale risk.
_______________________________________________________________
Questions:
Background:
- I am a small business owner (LLC, 5 members). We have no retirement benefits as a company and don't plan to.
- We have recently decided to split our compensation 50/50 between W2 and LLC distributions for tax savings purposes. We were previously paid 100% W2. Because of this change, my tax accountant says I can open a SEP as "Sole Proprietor / Schedule C", and thus have a new tax-advantaged investing avenue.
Questions:
- Is my tax guy correct? Is a SEP the best option here? Can I do a solo 401K in this situation? Feeling over my head on how this all works...
- Given how my allocation is already split between two accounts which are structured to avoid wash sale penalties, I'm unsure what to invest in in a new third account. Do I leave the taxable account as it is but stop contributing to it for now, or cash it out and put that money in the SEP? Obviously will pay a lot of taxes on that.
Statistics: Posted by irl — Fri Sep 06, 2024 11:19 am — Replies 1 — Views 74