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It has become virtually impossible for many new graduates to find a job or start a career. Even though a low cost student loan was seemingly a great idea at the time, it’s repayment time – and no job. Last year the Education department introduced a program to help. It’s called income-based repayment, or IBR. The program capped loan payments at 15% of the borrower’s income. Check out the calculator at www.ibrinfo.org Repayment Options At one time,
A student loan afforded you a good education – OK. The loan was was made at an exceptionally low interest rate – no problem. There was no repayment until after graduation – I get it! A student loan is one of the best financing opportunities around, but now it must be repaid. For some borrowers, graduation is a happy time – a time of celebration, starting a new career, and even retiring college debts. For
This is my final post on Roth Conversions – I think. After careful consideration – understanding the differences between a Traditional and Roth IRA and determining that it is likely the best decision for you, you converted your Traditional IRA to a Roth! Feeling so good about the decision, you attempt to educate all your friends about the virtues of such a decision. There is a little extra skip in your step as you have figured
Until now we have only discussed IRA basics. Earlier posts provided information on Traditional IRAs and Roth IRAs. Once you understand that converting a Traditional IRA to a Roth typically creates a tax liability for the amount converted, why would anyone convert? Since the idea of accelerating income flies in the face of traditional tax planning, you must be asking yourself, “Why would anyone want to convert?” My response – “A very good question!” So is all
With the lure of tax-free distributions, Roth IRAs have become popular retirement savings vehicles since their introduction in 1998. But if you’re a high-income taxpayer, chances are you haven’t been able to participate in the Roth revolution. Well, that has all changed. What Changed? In 2006, President Bush signed the Tax Increase Prevention and Reconciliation Act (TIPRA) into law. TIPRA repeals the $100,000 income limit for conversions, and also allows conversions by taxpayers who are
In Part I of the “Roth Coversion Series”, we considered the nuts and bolts of a Traditional IRA. With all the talk of converting to a Roth (In essence moving a Traditional IRA to that of a Roth.), we certainly want to know more about this type of retirement account. What is all the hype about? Definition A Roth individual retirement account (IRA) is a personal savings plan that offers tax benefits to encourage retirement
Seemingly every financial institution and advisor want you to consider a Roth Conversion. Well… anytime I hear the word “Conversion” I think of a religious principle that I learned about as a child. In fact, the “Roth” is mainstream, and has been on the scene since the summer of 1977. And as you will see in later posts on the subject, you are permitted to “Unconvert”. In Part II of this series, we will look into the details of
It’s massive, and it’s complicated. At more than 2,000 pages, the Affordable Care Act (ACA for short) has left businesses and individuals confused about what the law contains and how it affects them. The aim of the law is to provide affordable, quality health care for all Americans. To reach that goal, the law requires large companies to provide health insurance for their employees starting in 2015. Medium-sized companies have until 2016 to provide health
BACKGROUND A piece in the LA Times reports that taking the country over the “fiscal cliff” would cost American households $3,500, on average in higher taxes next year. It goes on to say that almost 90% of Americans would see a rise in their tax liability. First, a quick review. “Fiscal cliff” is a term being used by many to describe the unique combination of tax increases and spending cuts scheduled to go into effect on
Have you ever noticed how a title can often mislead you? There is not so much about the moon in the movie “Twilight: Eclipse” nor was “Silence of the Lambs” about happy sheep offspring. And while the Health Care Act is in fact much about health care, it contains some provisions that might aptly belong under another title. For example, a new 3.8% Medicare contribution tax will be imposed after 2012 on unearned income from interest, dividends, annuities, royalties, rents,