[Bridget Staunton]

Manabouttien: totally agree paying high premiums for Medicare because if IRMAA and single person. Hubby with the lord so I am paying way too much being single

[Bridget Staunton]

It’s not like we inherited it we worked for it

[Carla B]

Originally Posted by Ski Bum

Thank you! I realize there are a bunch of variables, but I really appreciate this analysis (and I know it was a ton of work). This describes my wife and I fairly well and I have been wondering where the cut off point would be. This analysis places that point at $3M. Even if that is off by $1M, the info is useful. I always suspected it wasn't worth doing a conversion. I just wish I would have started a Roth younger. My kids know from my error though!

Depending on your age, maybe you shouldn't feel bad for not starting a Roth earlier. Remember, there was no Roth IRA until 1997.

[tophcfa]

Originally Posted by LoisR

Start taking SS at 62. Waiting until full retirement age to start SS means youl will have to live to approx 80 years old to make up for the years you didn't take SS. How many people do you know who passed before reaching 80?

Be careful! If you are getting Obamacare tax credits to help pay for health insurance between the age of 62 and 65, taking early SS could put you over 400% of the FPL and wipe out your tax credits, costing you thousands of dollars. Every situation is different.

[lawgolfer]

Originally Posted by huge-pigeons

I’m tired of hearing if you have money, you need to share it. Most people who have money when they retire worked hard and long hours during their working years. And these same people did the right thing and invested a lot of their money during those years for the future instead of partying and overspending. Now, the have nots want to condemn the people that did the right thing.

Socialism/robbing Peter to pay Paul does not work and will never work. ACA is the worst thing that was ever created, ask around.

As for taxes, your goal every year for your whole life is to pay the least amount of taxes legally. If you want to pay more, there is a line that lets you add more taxes to your return. Same for social security, we all paid SS taxes during our working years and now we are double taxed on these distributions which is unfair. Hopefully that will change.

Everyone got a tax reduction 5 or 6 years ago. Somebody mentioned the rich only pay 20% tax, that is huge. If you make $1M a year, they will be paying $200,000 in taxes, this is a huge amount of money.

We should implement a flat tax of 10% for everybody, no deductions, no loopholes, and we would have much more money coming in for the government to spend foolishly.

A flat income tax rate has advantages and disadvantages that are too numerous to discuss in this forum.

What is easier to discuss is the proposition that everyone should pay some income tax, i.e. everyone should have "some skin in the game". We have created a system where 40% of the people pay nothing and, therefore, think nothing about what the government spends with the exception that they want the government to spend more on them.

This reduces, if not eliminates, the involvement of a large part of the citizenry in the manner in which our country is run. However, it is particularly offensive to those who are taxed when the non-taxed are involved and vote on how to spend other people's tax money.

In the 1950's nearly all small, rural, school districts were eliminated and children were bused to large "consolidated" schools. Up to that time, the rural one, two, and three room schools were governed by residents of the area served by the school and the property owners in that area were taxed to pay for the schools. You better believe that, while pennies were pinched, a high percentage of the residents were knowledgeable about what went on at "their" school and were concerned that their children received a good education. These schools were the classic example of taxpayer involvement.

I'm not saying that these small, local, schools were the best way to educate children (although my wife came out pretty well from a two-room school in rural Illinois). What I am saying is that these schools demonstrate the social benefit of citizens having "some skin in the game".

[Stu from NYC]

Originally Posted by lawgolfer

A flat income tax rate has advantages and disadvantages that are too numerous to discuss in this forum.

What is easier to discuss is the proposition that everyone should pay some income tax, i.e. everyone should have "some skin in the game". We have created a system where 40% of the people pay nothing and, therefore, think nothing about what the government spends with the exception that they want the government to spend more on them.

This reduces, if not eliminates, the involvement of a large part of the citizenry in the manner in which our country is run. However, it is particularly offensive to those who are taxed when the non-taxed are involved and vote on how to spend other people's tax money.

In the 1950's nearly all small, rural, school districts were eliminated and children were bused to large "consolidated" schools. Up to that time, the rural one, two, and three room schools were governed by residents of the area served by the school and the property owners in that area were taxed to pay for the schools. You better believe that, while pennies were pinched, a high percentage of the residents were knowledgeable about what went on at "their" school and were concerned that their children received a good education. These schools were the classic example of taxpayer involvement.

I'm not saying that these small, local, schools were the best way to educate children (although my wife came out pretty well from a two-room school in rural Illinois). What I am saying is that these schools demonstrate the social benefit of citizens having "some skin in the game".

You are right on/!

[GoRedSox!]

Originally Posted by lawgolfer

A flat income tax rate has advantages and disadvantages that are too numerous to discuss in this forum.

What is easier to discuss is the proposition that everyone should pay some income tax, i.e. everyone should have "some skin in the game". We have created a system where 40% of the people pay nothing and, therefore, think nothing about what the government spends with the exception that they want the government to spend more on them.

This reduces, if not eliminates, the involvement of a large part of the citizenry in the manner in which our country is run. However, it is particularly offensive to those who are taxed when the non-taxed are involved and vote on how to spend other people's tax money.

In the 1950's nearly all small, rural, school districts were eliminated and children were bused to large "consolidated" schools. Up to that time, the rural one, two, and three room schools were governed by residents of the area served by the school and the property owners in that area were taxed to pay for the schools. You better believe that, while pennies were pinched, a high percentage of the residents were knowledgeable about what went on at "their" school and were concerned that their children received a good education. These schools were the classic example of taxpayer involvement.

I'm not saying that these small, local, schools were the best way to educate children (although my wife came out pretty well from a two-room school in rural Illinois). What I am saying is that these schools demonstrate the social benefit of citizens having "some skin in the game".

But they don't pay nothing. Their income is low enough and they have enough children that with the earned income tax credit and child care credits and the standard deduction, they end up owing no federal income tax. But they still pay state income tax in most states. They still pay Medicare and Social Security taxes. They still pay sales taxes. They still pay federal excise tax on every gallon of gas and other miscellaneous taxes. To question their right to vote is really something.

[lawgolfer]

I am not questioning the right of non-taxpayers to vote. I am questioning the wisdom of having 40% of the citizenry pay nothing in income tax. Many of this 40%, as well as many of the 60% paying income taxes, will not vote in any event. My point is that citizens who pay income taxes are more likely to vote and to consider the issues on which they vote and the platforms of the candidates they have to choose among.

As I recall, only property owners could vote in the school board elections in the rural districts in Illinois. However, many of the owners had tenants who farmed their land and many of the tenants as well as owners farming their own land had one or more "hired men'. The tenants and the hired men lived on the farms and had families. Providing decent schools for the children was a serious obligation. The men and women who were elected to the school boards took this obligation seriously and were proud of their school. I admit I view those times through rose-colored lens; however, I know from personal experience that those schools were a prime example of the benefits of an involved citizenry.

With the increased mechanization of farming and the consolidation of small farms into large ones, the rural population rapidly diminished in the 1950's. This, together with the increase in supervision of all schools by the state resulted in the consolidation of the schools into area-wide districts.

[Jack58033]

Baum and Parady will pay for you to go away.

[Jack58033]

So you want Universal health care?

[Haggar]

I have the greatest respect for your projections. I have many clients who are asking me not because of IRMMA but what's the best thing for them in the long run? And the problem with any of these projections is: What will be the rate of investment growth? What will be the tax rates in the future?
And what the effect of a reduced amount to invest because of the taxes required to be paid in the year of conversion. If you're
in a higher bracket the investment amount could be reduced by 20-30% which will affect the yield and growth.

Someone mentions that the sale of a house (particularly a non-residence) could cause an increase in IRMMA (which will calculated for 2024 based on your 2022 return). Yes it could but there a form you can file which requests medicare to reduce the premium based upon non-recurring events or life changing situations. Their response to filing this form is very quick.

[Pugchief]

Originally Posted by blueash

You're not buying Medicare or don't you know that? If you were paying the cost your premium would be huge, not a few hundred a month. The people paying for your health insurance right now are the workers of the US. And they are paying your premiums for you because, well Socialism. See how you benefit when the government takes money from somebody and gives it to you?

Didn't everyone pay 3.9% (2.45% employee + 2.45% employer) of their income to cover Medicare? You paid for this "insurance" yourself. And higher earners already paid more in premiums than lower earners. If I had kept that 3.9% and invested it, I could use that money to more than cover whatever current healthcare premiums would be.

Originally Posted by blueash

And now you want to base health insurance premiums on the health and age of the insured. Thank your lucky stars that ACA and Medicare did away with such things.

Health insurance premiums are absolutely based on age. Yes, ACA did away with basing premiums on health, but it is debatable whether that was a good thing or not. Pre-existing conditions needed to be eliminated for sure, but why should a non-smoker pay the same as a smoker? Or someone who eats healthy and exercises pay the same as an overweight couch potato? Controllable diseases should be risked out into the premiums IMO, but not things beyond the patient's control.

[manaboutown]

Originally Posted by Haggar

I have the greatest respect for your projections. I have many clients who are asking me not because of IRMMA but what's the best thing for them in the long run? And the problem with any of these projects is: What will be the rate of investment growth? What will be the tax rates in the future?
And what the effect of a reduced amount to invest because of the taxes required to be paid in the year of conversion. If you're
in a higher bracket the investment amount could be reduced by 20-30% which will affect the yield and growth.

Someone mentions that the sale of a house (particularly a non-residence) could cause an increase in IRMMA (which will calculated for 2024 based on your 2022 return). Yes it could but there a form you can file which requests medicare to reduce the premium based upon non-recurring events or life changing situations. Their response to filing this form is very quick.

A friend of mine sold her long time home in Miami at a price that threw her into IRMAA even though she has little retirement income other than Social Security. She appealed and lost even though it was a once in a lifetime gain. Her SS income for 2023 was substantially reduced. In her case IRMAA was confiscatory. For couples selling a primary residence held the requisite number of years the first $500K LTCG is excluded from counting as income toward IRMAA but for a single person the exclusion is only $250K. IRMAA is vicious and merciless, particularly to folks receiving a once in a lifetime LTCG such as from selling their long term primary residence, the family farm or a mom and pop business.

[zuidemab]

Thank you for the facts.

[Rainger99]

Originally Posted by blueash

You're not buying Medicare or don't you know that? If you were paying the cost your premium would be huge, not a few hundred a month. The people paying for your health insurance right now are the workers of the US. And they are paying your premiums for you because, well Socialism. See how you benefit when the government takes money from somebody and gives it to you?

Sorry, Seniors, You Didn't Pay for (All of) That