Retirement Flashcards
Self Employment tax based on what % of income?
92.35%
Self Employment Social Security is how much?
12.4% up to 92.35% of pay up to $168.6k
Self Employment Medicare is now much?
2.9% up to 92.35% of pay plus 0.9% on anything over $200k
401k catch up and age
$7,500 for 50+
403b catch up and age
$7,500 for 50+
$3,000 for 50+ and 15 years of service
457 catch up and age
$7,500 for 50+
$46,000 total ctrbs in L3Y
Simple IRA limits
$16k deferrals
$3.5k 50+
Maximum deductible for a company?
25% of pay
Maximum contribution deductible for an owner?
Contribution rate for all = x%
Max for owner: x% / (1+x%) X .9235
Which plans can do what % of stock?
PS/401k : 100%
Target and MP: 10%
Max comp that can be used
$345k
Max benefit allowed
$275k
Minimum vesting allowed in DC plans
2-6 graded, 3 year cliff
Minimum vesting allowed in DB plans
DB plans: 3-7 graded, 5 year cliff
CB plans require 3 year cliff mim
SEP and Simple Limits
SEP 25% of pay or $69k
Simple $16k + $3.5k catch up
How much of an IRA deduction is phased out?
($ over the min) / (spread of phase out)
Can you contribute to an IRA if neither you nor your spouse is covered by a plan?
Yes, both of you, no income limits.
Can you contribute to an IRA if you are covered by a plan?
Yes if your income is within the limits ($77-87k; $123-143k). Your spouse can too.
Can you contribute to an IRA if you are not covered by your spouse is?
Yes if your income is within the limits ($230-240k).
Early IRA withdrawal penalty?
Direct rollover no penalty, no tax
Not direct? 20% tax and 10% penalty on the distribution
Inherited IRA: years to distribute
Spouse can defer until 73 or add to own IRA
Eligible beneficiaries: their lifetimes
Non-Spouse beneficiary: 10 years
Non-Designated benes: 5 years
what is the definition of Eligible beneficiaries for social security?
Spouse, chronically ill or disabled, kids<21, those <=10 years younger than dead guy
Non-Spouse beneficiaries
Kids, others more than 10 years older than dead guy
When can you take $ from a Roth?
After 5 years AND either
59.5, dead, disabled, 1st time homebuyer
Non-qualified Roth IRA distribution rules?
If taken out too soon, earnings are taxed and they get a 10% penalty. No tax or penalty on contributions
SERP?
Pays comp of a specified amount and period as long as years of service are reached
can you fund a non-qualified plan?
Only a rabbi trust - it’s not shielded from corporate creditors
Non Qualified Stock Options taxation
Ordinary income when you exercise, Cap gains when you sell
Incentive Stock Options taxation
Only on sale
Cap gains if sold 1+ year from exercise and 2+ years from grant: (Sale - Grant)
Ordinary income if not (Exercise - Grant)
How many years for the AIME calculation?
35 best years, include $0 for those years not working. All your income is added up.
Social security discounts?
20% for 64-67 (5/9%)
10% more for 62-64 (5/12%)
24% premium for 67-70 (2/3%)
Working and taking SS? Discounts are:
Half of your SS is taken if between $22k-$59k
33% is taken if over $59k
Provisional income (your income for SS taxation purposes) =
AGI + 50% SS + tax exempt
Spousal SS Rules
Can take at 62 if worker is taking SS
You get max of 50% worker’s PIA or your own
If worker takes early SS, spouse gets 8.33% discount on the PIA (<50%) per year
Must be married for 1+ year
Ex Spouse SS Rules
Not subject to family limit
Can take at 62 even if spouse is not taking SS
Must be married for 10+ years, unmarried, have been divorced for 2+ years.
Medicare - IRMAA. what is the income formula?
AGI + tax exempt income
Social Security - kid rules
<18, disabled adult <22. Worker must be receiving benefits. Max benefit 50% of PIA.
Net Unrealized Appreciation
For ER stock only and you take 100% lump sum. ER basis is taxed @ ord inc. Your distribution is taxed at cap gains. When you sell it’s taxed based on holding period from distribution date.
