Retirement

Retirement

Help to file taxes

Personal trust and simple 1040 taxes need to be filed.

Retirement

How do I maximize my 2026 standard deduction?

I am 69 and my husband is 75. In 2025, I worked full time and had plenty of taxable income to apply against our $46,000 standard deduction. This year, I am retired. I have postponed receiving social security and will have no W-2 income. We expect our '26 taxable income to be only around 6K. We want to use all of the standard deduction. What are the tax implications of a $40K distribution from my taxable retirement acct? Is there a better strategy to use all the standard deduction?

Retirement

Roth IRA Withdrawal

I’m 47, live in CA, and make $80k a year. What will my federal tax, state tax, and penalties be on an unqualified $125k Roth IRA withdrawal?

Retirement

Application of IRS §72(t)(2)(A)(v) does it apply to All 401(k) plans

My plans SPD states ARTICLE VII BENEFITS AND DISTRIBUTIONS UPON TERMINATION OF EMPLOYMENT When can I get money out of the Plan? You may receive a distribution of the vested portion of some or all of your accounts in the Plan for the following reasons: • termination of employment for reasons other than death, disability or retirement • etc. Does this mean that if my employment is terminated in the year I turn 55 I am not subject to any extra penalties on withdrawals

Retirement

Tax obligation

Someone wants to withdraw a chunk of his retirement from his union job. He wants to buy a piece of farm equipment and right it off. The farm is a family business I told him he needs to pay tax on his retirement no matter what he spends the money on. Does he need to pay taxes on funds withdrawn from his annuity.

Retirement

How to fix an excess contribution to a SEP IRA

In '25, I contributed too much to my personal SEP IRA for '24. I had part of the excess recharacterized as a trad. IRA contrib for '25 and am using a form to withdraw the remaining excess. All seems clear except I have to choose a correction method- IRC404(h) or EPCRS. Which do I choose? What happens if I choose incorrectly? Will there be other documents or forms required later depending on my choice? (I filed for an extension for '24 taxes. I will not have any self-employment income in '25.)

Retirement

Backdoor IRA

Hello, I am from CA state. I have 401k from the job. roth IRA income limits do not allow me to contribute directly to the roth IRA. Is it ok for me to open Traditional IRA, contribute after-tax money ($6000 limit) into it and transfer them to the Roth IRA. I do not have any other IRA accounts. only 401K and company RETIREMENT SAVINGS PLAN (not contribution from me into this account).

CPA Answer:

Yes the backdoor IRA strategy will work for you. One note of caution is that there is potential this strategy will be limited if the version of the Build Back Better Act that is about to go to the Senate for a vote passes. Consider making the move soon as some of those provisions will take effect Jan of 2022.

Additionally note that there is a possibility of the side door Roth if your plan at work allows non deductible 401k Contributions. Reach out if you want to discuss further

Answer Provided by: David Huff

Social Security

2018- Social Security

CPA Answer:

For 2018, the tax rate on the employee portion of Social Security is 6.2% on wages up to $128,400, so Social Security tax withholdings should not exceed $7,960.80. Medicare tax of 1.45% is withheld from all wages regardless of amount.

On Schedule SE for 2018, self-employment tax of 15.3% applies to earnings of up to $128,400 after the earnings are reduced by 7.65%. The 15.3% rate equals 12.4% for Social Security (6.2% employee share and 6.2% employer share) plus 2.9% for Medicare.

If net earnings exceed $128,400, the 2.9% Medicare rate applies to the entire amount. One half of the self-employment tax may be claimed as an above-the-line deduction on Schedule 1 of Form 1040.

Answer Provided by: CPAdirectory

Social Security

Earnings limit for T/P's under full retirement age

CPA Answer:

Recipients under the full retirement age can earn up to $15,720 between the ages of 62 and 65. people who turn 66 in 2016 will not loose any benefits if they earn $41,880 or less before they reach that age.
Recipients under the full retirement age can earn up to $16,920 between the ages of 62 and 65. people who turn 66 in 2017 will not loose any benefits if they earn $44,880 or less before they reach that age.

Answer Provided by: CPAdirectory