Can I use my Roth IRA as my emergency fund?
Sure—you already paid tax on the money you contributed to a Roth IRA.
However, there are a few rules to follow. When you withdrawal
Roth IRA funds for an emergency or any expense, take the “contributions”
first. Your custodian usually has a record of what you put in versus what that
money has earned. Contributions can’t be taxed again and there is no penalty
even if you are under 59.5 years old. If you are older, there is no tax either.
Make sure you tell the custodian that you plan to put the money back in 60 days
so they code the withdrawal properly. You
are allowed only one rollover per year. Logically, you want to keep your
Roth IRA emergency money in a money-market fund. However, many folks begin making
contributions to a balanced (stocks and bonds) fund so they can build up the
amount over time. Periodically move money to a Roth IRA MMF. When you need
funds, make sure the money can be transferred to your bank account quickly. Do NOT
let them take taxes out—you paid taxes on this money already. Don’t let them cut
a check that you won't get for weeks—they like to hold the cash in their
account as long as possible. You can even use this fund to pay no taxes later
in retirement.
Build your tax-FREE account: https://www.amazon.com/Your-ZERO-Tax-Account-Wealthy/dp/1482772795
Which type of broker/advisor is best for you?
If we could know the future, this would be an easy decision. Bernie
Madoff just died but his fraud is a lesson. Madoff pleaded guilty to 11
crimes: defrauded as many as 37,000 people in 136 countries over four
decades. Mr Madoff
was chairman of one of Wall Street’s regulators at one time. His investors
gave him tons of money to invest because he promised to do his best and his
creds were above many other advisors. Each week I document the many scammers in
my old industry. There is no
guarantee for investors. As a broker dealer manager, I saw how good
well-meaning sales people can veer into trouble. Why? There are few safeguards
in money-handling sales. The product is invisible. One is the designation called CFP. CERTIFIED
FINANCIAL PLANNER™ Like a lawyer,
they work for fees not commissions. The other way to help you avoid a Madoff
type scam is to use a fee-only securities provider. Vanguard Group offers
products via a unique corporate structure: We
investors actually own the funds we invest in. There is no middle person/firm
to take profits. Vanguard has salaried non-commission
licensed “crew members” to help us. And Warren Buffett, one of the greatest
investors, recommends Vanguard Funds. Use a less biased advisor without an
incentive to steal.
Make Buffett be your advisor: https://www.amazon.com/Warren-Buffetts-Vanguard-Funds-Retirement/dp/1496148592
We don’t have to pay off the $1 Trillion in taxes that the wealthy owe
The actual annual tax gap possibly exceeds $1
trillion per year, IRS Commissioner Charles Rettig told senators Tuesday.
You and I know why the Congress does not do anything about it. Congress
receives funds from the wealthy that let them hide their money from the rules
that we
must follow. We can’t afford to hire lawyers and accountants to set up
offshore and intricate legal entities to obscure income. Remember how President
Trump
boasted that he doesn’t pay taxes because he is ‘smart’. Actually
his staff is paid to hide his income. Since we only have one year available
to see how he does it, we know one method—use the paper losses of a business to
write off personal income. In the 1995 return he claims a loss
of almost $1 billion: we taxpayers owed him a refund for many future years
of his personal income. For the wealthy, even the ones that don’t hide income,
the rules allow them to pay about HALF the rate we pay. Warren Buffett explains
that he pays only 17.7%;
HALF the 33% his staff pays. We have two ways to avoid paying for the national
debt that the rich have run up. ONE: we start by using a business to cover some
expenses and let the loss offset our income. TWO: we produce income inside a
tax-FREE account. We produce tax-FREE income legally.
Start today: https://www.amazon.com/Tax-Free-Living-2012-strategies-build/dp/1477452702/
Is there a correct number of stocks to own?
Sure! Just one if you were Apple’s Steve Jobs or Microsoft’s Bill Gates
or Amazon’s Jeff Bezos.
But most of us including Warren Buffett can’t know which stock will be
the top grossing stocks of all time. So here is the answer as explained by Mr Buffett
and his partner Mr Munger:
We like to put a
lot of money in things that we feel strongly about. And that gets back to the
diversification question. You know, we think diversification is - as practiced
generally - makes very little sense for anyone that knows what they're doing. Diversification
is a protection against ignorance. For most of us who know we do not know
how to analyze businesses, we buy everything—an index of the top 500 stocks. If you know
how to analyze businesses and value businesses, it's crazy to own 50 stocks or
40 stocks or 30 stocks, probably, because there aren't that many wonderful
businesses that are understandable to a single human being, in all likelihood.
Charlie Munger said: The first rule of compounding: Never interrupt
it unnecessarily.
If an
initially very concentrated portfolio is likely to turn into an unbearably
concentrated portfolio after a few years, then it's not really built with the
long term in mind. So if you are clear on what you DO NOT KNOW, compound
the index for 11%.
Buffett strategy: https://www.amazon.com/MasterClass-Buffetts-SIMPLE-Strategy/dp/1983485268
Which market sector will provide the best returns in the future?
Since we can’t know what is ahead and we can’t assume the future is
determined by the past, which sector are you betting on? ETFs have become the
broker/advisor security of choice so that they can trade every day. However,
most serious investors know that fast trading prevents you from enjoying
multiple-year compounding and dividends. So which one do you favor for the
future? Energy
is the current leader but can it return 30% in the next few years. Or will
it fall out of favor like consumer staples? Unless you know your business
sector well or have Mr Buffett’s talent for analyzing large companies, you may
be better off skipping your broker/advisor’s recommendations and just holding a
low-cost index of large or small, growth or value stocks. Actually the most popular
choice is the large company stock index. John Bogle, founder of Vanguard
Group, created the simple 500 index fund because his research showed it was
better for us to avoid trading by expensive stock pickers. Investing does not
have to be complicated.
Simple wins: https://www.amazon.com/Buffett-Bogle-Holy-Bible-Investment/dp/1523693045
How to “guarantee” a tax-FREE retirement income
Put your investing on automatic. Use Buffett's Investment Strategy: Set
it and Forget it "… our favorite holding period is FOREVER.” Manage the
account only once a year! Contribute $9 a day, $250 a month. Accumulate
$55,000, $200,000, $1,000,000 over time. Use a special IRS account for Tax-FREE
income. Use only low-cost high-return mutual funds. Warren Buffett's Investing
Strategy is buy and hold FOREVER high earning companies. This allows compounding
to work. Compounding is money earning money on its earnings when it is
invested. Invest your money in businesses sharing profits with you and over
time you can reach $1,000,000. A special account makes it tax-FREE. Tax-FREE is
like a $300,000 bonus. When we invest in successful businesses, we
can earn 10% to 12% a year. After 10 years, we can have $55,000 because the
businesses paid dividends and we reinvested them. After 20 years, we could have
$200,000 and after 33 years, perhaps $1,000,000. Over time, stocks are safer
than bank CDs because we earn more than inflation subtracts. We have more
buying power. Compounding works best when we put our money to work in
successful businesses paying us dividends and stock splits. When we use a
low-cost AND tax-FREE account, we avoid fees and taxes so we keep more of our
money to compound. See how fast our investment can grow if we invest it in
businesses like the ones we use every day.
https://www.amazon.com/Warren-Buffetts-Investment-Strategy-Forget/dp/1484822900
Where is that refund?
The Internal Revenue Service today reminds taxpayers that the most
convenient way to check on a tax refund is by using the “Where’s My Refund?” tool at IRS.gov or through the IRS2Go Mobile App.
Where is the stimulus 1 or 2? If you did not receive stimulus 1 or 2, start filing here: https://www.irs.gov/newsroom/recovery-rebate-credit.
Estimated tax payments are still due April 15. If you are self-employed or do not have enough withheld from a paycheck, pension or Social Security, you may have to send quarterly payments to the IRS. Tax returns for 2020 are due May 17 not April 15 but the estimated tax payments are still on schedule.
IRS
will redo your taxes and send refund if you paid tax on Unemployment 2020
or you paid ObamaCare’s
excess advance premium tax credit repayment.
Have tax forms; will file … for FREE but WAIT . . .
If you have unemployment income, ObamaCare coverage you should wait to file since the IRS has not yet implemented tax-FREE provisions of the new Covid law. If you already filed and paid tax on your unemployment income, IRS says it will send you a refund of the tax automatically. DO NOT FILE an amended return to obtain a refund on this tax. Taxes due MAY 17 not April 15. Input the W-2, unemployment, SS benefits, IRAs, pensions, RMD, brokerage, etc. forms you have. You can file for FREE online. If you didn’t receive a correct form, file a Form 4852. Usually filing your state return costs as little as $15 unless you buy the Pro helpline. Avoid $300-400 paid preparer fees—new IRS forms mean higher fees. Unemployment insurance is TAXABLE on the Federal income tax return; not on some state returns. Some states do not tax your SS and pension benefits.
Retirees did not have to take their RMDs
in 2020 so taxes may be less: it was a good time to convert
IRA to Roth IRA for tax-FREE future. Unless you were self-employed, you
can’t deduct home office expenses of working from home. You can deduct as
medical expense all Covid
prevention supplies. Some states continue the health
insurance mandate and penalty unless you have an exemption. Since the IRA
contribution deduction has no age limit now, you may reduce your income/taxes
by making a contribution of up to $7,000. The standard
deduction went up to $12,400 single; $24,800 joint. Jan 15 last day to make 2020
estimated payments. You have to report your April/May and December/January
stimulus payments even though they are not taxable. Some of us receive a bank
credit; some a debit
card; some a check. Even if you don’t have to file, you should file so scammers
can’t use your SS number to mess up your IRS file. Tested
E file software ratings. Efile
Jan 15; IRS processing Feb 12.
E file avoids covid at your preparers’ office: https://www.irs.gov/filing/free-file-do-your-federal-taxes-for-free
What to do if you can’t pay by May 17?
Avoid the penalty for not paying estimated tax. Ask for an automatic extension to file till October. If that does not work for you, you can apply for a payment plan. An individual can setup an IRS installment plan if you owe $50,000 or less and can pay back the amount owed in 3 years. If you are a business owner, you can setup an installment plan if you owe $25,000 or less. The IRS will charge a one-time fee of $105.
If you own
less than $25,000 and can pay the amount owed within six years, ask the IRS
for a streamlined payment agreement. The IRS will charge a one-time fee of
$102.
Request an Offer in Compromise if you cannot pay the total amount owed. This allows you to settle your tax debt for less than the total amount owed if you will be unable to pay back the total amount owed within 10 years. The IRS will charge a one-time fee of $150. Given the pandemic economic hardship, apply for the extension to file now: https://www.irs.gov/pub/irs-pdf/f4868.pdf
Special circumstances help: call the IRS Taxpayer Advocate Service 1-877-777-4778 for free assistance.
More ways: https://www.irs.gov/newsroom/heres-how-people-can-pay-their-federal-taxes
IRS has $1.3 billion
refunds for 2017 tax returns
Unclaimed income tax refunds worth more than $1.3 billion
await an estimated 1.3 million taxpayers who did not file a 2017 return,
according to the IRS. “Time is quickly running out for these taxpayers. There’s
only a three-year window to claim these refunds, and the window closes on May
17.” If they do not file a tax return within three years, the money becomes the
property of the U.S. Treasury. Filing instructions are available on the IRS.gov Forms and Publications page or 800-829-3676.
You have 45 days to collect your cash!
**********ACCOUNTABILITY**************
Like 1776, this
period is a test
of democracy—We
rejected an "American
fascist"
Swing
state GOP laws limit Dem voting: “only way to win”
Will
the ‘militia’ (terrorists) try another coup?
Trump
delayed helping: Capitol Police died
Where ‘Truth
and Reconciliation Commission’?
How Govt wastes our money:
MS, AR, TN, AL, GA have unused vaccine slots: GOP deny Covid danger
40% Marines afraid of vaccine shot: Pentagon costs of health care to rise so we pay more
FedEx made $1.2 BILLION in profits last year but paid NOTHING in federal taxes
IRS fails to collect $1 Trillion in taxes from wealthy tax avoiders: we must pay
Can we really leave and stop wasting taxes in Afghanistan? Still paying for 5000 bases!
Biden seizes owner’s land on Rio Grand to continue Trump’s Wall? Promise to stop!
SCAMS/SPINS:
Christian
nationalists raise $ millions for domestic terrorists: GiveSendGo pays
killers
Unvaccinated
people much more likely than the vaccinated to say it's safe
for them to travel?
MN
police say they don’t
know the difference between their guns and their tasers: taser on left?
Trump
hides taxes: used Prez excuse when Prez; now uses not Prez excuse when not
Prez
Head
of FBI’s field office in Albany promoted after sexual assaults on 8 women:
no jail
Anthony Wayne March
NC caught
Ponzi fraud promised tax-deductible annuity 11 yrs
Tiger Woods caught
speeding according to his car computer but no violation: spec treat?
$2.75/dox
eggs just as nutritious as organic/’free range’ $7.49 eggs Marketplace
AAA cramming donations
into roadside service bills: use credit card customer service
Amazon scam: fake promise of refund
takes hold of your computer for bank access
Phony
IRS email to take your personal information to claim your “tax refund.”
SettleIt caught
steering us into high-cost loans offered by affiliated lenders: fine no
jail
Costco
fake offers hit on all levels: BEWARE ‘free’
Twisted
fake views feed propaganda of haters: they wouldn’t print it if it were
false
Bitcoin
can be spent at nightclub: now you have
a place to dump your non-money money
6 GOP and Asian hate
crimes bill: Cotton, Hawley, Cruz, Marshall, Paul, Tuberville.
IRS: Easy Steps to Protect Your Computer and Phone and Avoid Phishing Emails.
IRS: Free special ID
protection PIN goes on your return so scammers
can’t take refund
IRS: Previous tax
returns available online: https://www.irs.gov/individuals/get-transcript
IRS tips to avoid
scams: https://www.irs.gov/newsroom/tax-scams-consumer-alerts
Is it a scam? Check AARP scamline
877.908.3360. BBB
Scam tracker
Check
IRS: https://www.irs.gov/newsroom/dirty-dozen-part-1-taxpayers-should-be-on-the-lookout-for-these-scams
https://www.irs.gov/newsroom/dirty-dozen-part-2-thieves-work-all-year-to-scam-taxpayers
Find tax preparer: https://www.irs.gov/tax-professionals/choosing-a-tax-professional
Check Social
Security: https://blog.ssa.gov/
Safeguard data:
ConsumerReports help: https://securityplanner.consumerreports.org/
Jobs
Amazon
keeps union out and wages//benefits
low
Most
marines decline vaccine for Covid: 40% wait and see if vaccine needed
Your employer may have been
paid to keep you at work: show them and take your pay
25
high pay jobs to reach for the future: plus machines
can’t replace skilled trades!
Who owns your account now?
You will pay significantly more to insure homes in coastal areas and flood zones
laid-off workers can keep their employer-sponsored health insurance thru Sept FREE.
Your children may obtain FREE coverage too.
Funeral bill covered if Covid related death: 1 less thing to worry about
Now your personal ancestry data is owned by brokers at Blackstone
Miracles:
Sea
levels could rise as much as 60 feet from melting ice sheets: move
Miami?
herpes
virus modified defeats child brain cancer cells: new hope for rare cancer.
Biden
ends Trump’s racist housing rules: fair housing is a right for non whites
too
Biden to end longest US war: 2,400
dead; 20,000 maimed plus 2,977 9/11
dead
Or
is the US just going undercover: advisers, black ops, Osama strike force?
Troops
to Ukraine next? 500
more German staging area: over 35,000 ready.
We can apply for
Medicare online: https://blog.ssa.gov/apply-for-medicare-online
We can apply for
Social Security online: https://www.ssa.gov/benefits/retirement/
We can apply for
health care online: https://www.healthcare.gov/
IAN
41 Watchung Plaza,
B242
973.746.2014
www.InsuranceAdvisorsNetwork.com
Alerts available
at http://dankeppel.blogspot.com/
