Money Investing megathread extravaganza - Page 891

**DaFace** · 06:35 PM

A place to talk about investing stuff.

**Buehler445** · 03-14-2023, 09:35 AM

Quote:

Originally Posted by Rain Man

Oh, this is nice. When Signature Bank collapsed, they replaced it on the S&P 500 with BG (Bunge). I have a lot of BG stock, and it spiked up since the ETFs will all need to start buying it. Out of the ashes rises a phoenix.

LOL nice.

Why do you own Bunge? Just had to get in the grain business?

**Rain Man** · 03-14-2023, 09:54 AM

Quote:

Originally Posted by Buehler445

LOL nice.

Why do you own Bunge? Just had to get in the grain business?

Y'know, I've had it for a decade or so, and it's treated me pretty well. I bought it because I liked the dividend and for some reason I have a bias toward raw material stocks. Overall, it's been a pretty decent performer for me and I've been inching up my holdings at the right time these past couple of years.

**Rain Man** · 03-14-2023, 09:57 AM

Quote:

Originally Posted by Rain Man

Here's something I find kind of humorous. I saw that 5-year CDs were being offered up to 5.4 percent, so I looked at them. The top offerer is the "Bank of Bird-in-Hand".

Does that sound scammy or what? So I looked up this bank, and it turns out that it's a small bank that's located in the town of Bird-In-Hand, Pennsylvania. It caters mostly to Amish people, and in fact their drive-through window is designed to accommodate horses and buggies.

I might have to put a little money into this Amish bank's 5.4 percent rate.

I just bought some 5.3 percent CDs at Bird-In-Hand. (I missed the 5.4, dang it.) If you can't trust the Amish, who can you trust?

**Buehler445** · 03-16-2023, 07:02 AM

Quote:

Originally Posted by Rain Man

I was thinking about something the other day involving tax rates, and I think the government is running a little IRA grift on us. It's still better to put money into an IRA than to not do it, but this is something I'd never thought about.

If you put money into a stock in an IRA and the price grows, then yay, you make money. When you eventually take it out, you pay regular income tax on the gains, which is going to vary, but it's almost certain to be 22% to 35% for most people.

If you bought that same stock in a regular investment account, you're going to pay capital gains tax when you sell it, which is probably going to be 15% for most people.

So by holding it in an IRA, you end up paying a higher tax on the gains.

Now, it's still better to put it in an IRA because it's pre-tax money going in, which gives you a bigger investment, and the taxes are deferred for many years, but I'd never thought about the fact that you take a bigger bite coming out.

Am I thinking about this right? Do I have any wrong assumptions?

Just a heads up. For the high income folks.

Biden Calls for Doubling Capital Gains Tax Rate (LT CG Rates for those earning over $1M)

I don't have a clue whether or not this passes. Most of the mother****ers that would have to pass this thing....would have exposure.

But nonetheless, the agenda is out there.

**DaFace** · 03-16-2023, 08:27 AM

Quote:

Originally Posted by Buehler445

Just a heads up. For the high income folks.

Biden Calls for Doubling Capital Gains Tax Rate (LT CG Rates for those earning over $1M)

I don't have a clue whether or not this passes. Most of the mother****ers that would have to pass this thing....would have exposure.

But nonetheless, the agenda is out there.

A million in EARNINGS per year? That's a pretty high bar. I wouldn't think that'd even apply to most politicians.

**Buehler445** · 03-16-2023, 09:21 AM

Quote:

Originally Posted by DaFace

A million in EARNINGS per year? That's a pretty high bar. I wouldn't think that'd even apply to most politicians.

I bet you’d be surprised.

I’m certainly open to being wrong though. 175K is off the table with salary. Plus you have to have a good bit of wealth to dump whatever career you had before.

These bastards all retire rich, but I don’t know how much income they’re claiming. I do know when Romney ran he’d have had exposure.

**lewdog** · 03-16-2023, 07:56 PM

I'm thinking of doing a ROTH conversion in my wife's IRA account. It's roughly $20k so I'd have to pay taxes on it. Still seems worth it right and would I have to pay estimated taxes on that or can I just roll it into next year's taxes?

**Rain Man** · 03-16-2023, 07:58 PM

Quote:

Originally Posted by lewdog

I'm thinking of doing a ROTH conversion in my wife's IRA account. It's roughly $20k so I'd have to pay taxes on it. Still seems worth it right and would I have to pay estimated taxes on that or can I just roll it into next year's taxes?

I'm no accountant, but I wouldn't see any need to pay estimated taxes unless the conversion would put you out of the withholding safe harbor and cause tax penalties.

DRU · 03-16-2023, 08:58 PM

Anybody in here doing anything with real estate syndications and/or private lending?

We put some cash into a syndication deal last year that purchased some very large apartment complexes. We get monthly 10% distributions (cashflow), and we also get a K1 that shows paper losses which offset the income we're generating, so the income we make from the deal is completley tax free.

Separate from that we are now doing private lending deals as well. So we're earning 10%+ interest payments on those deals monthly, and again, the income from these deals is offset by the K1 losses from the syndication, so it's all tax free income as well.

When the syndication closes we would have to recapture the depreciation, but you can do a 1031 exchange into a new syndication just like any other RE deal. This defers the tax, gives us even more K1 paper losses from the new deal, and allows us to continue earning monthly distributions from syndications and private lending deals tax free.

When we die our beneficiaries get a "step up" in basis the same as any property we pass to them outright, so they won't have to pay any of the taxes from all those years we've been deferring.

They could continue where we left off, and keep moving into new deals to continue getting more tax free cash from them, or they could exit and only pay a small tax on the little gain they may have had after the step up in basis.

It's giving us most of the benefits of RE without any of the hassle! I don't have to shop for deals, negotiate, manage properties, service loans, or any of the stuff that comes with RE investing.

The only thing we don't get (because we chose the higher cash flow option) is equity growth on the back end when the deal closes. We just get our initial principal back.

However, we still have active income as well, so we're taking the tax free passive income we're getting from these deals and throwing it all into a ROTH where we're DCAing into index funds (and some individual stocks.)

Of course, that will all be 100% tax free as well, and in theory will give us the growth factor that we aren't getting from the syndication itself.

Again, we could choose to take less cash during the holding period and then get part of the equity growth from the syndication, but I prefer the cashflow right now.

I'm loving it so far, but would appreciate any feedback others might have that are already further down this road than we are.

**Buehler445** · 03-17-2023, 06:27 AM

Quote:

Originally Posted by lewdog

I'm thinking of doing a ROTH conversion in my wife's IRA account. It's roughly $20k so I'd have to pay taxes on it. Still seems worth it right and would I have to pay estimated taxes on that or can I just roll it into next year's taxes?

20K would likely expose you to an underpayment penalty.

I don’t know what the fee structure looks like, but usually the most cash flow effective thing to do is make an estimate in January. The easiest thing to do is have the rolling company withhold some on the roll.

The simplest thing to do is pay the penalty. I don’t know what that looks like though. The ones the software calculated for me have been pretty little. But I know you’re a cheap ass so I’d probably make an estimate.

**lewdog** · 03-17-2023, 07:45 AM

Quote:

Originally Posted by Buehler445

20K would likely expose you to an underpayment penalty.

I don’t know what the fee structure looks like, but usually the most cash flow effective thing to do is make an estimate in January. The easiest thing to do is have the rolling company withhold some on the roll.

The simplest thing to do is pay the penalty. I don’t know what that looks like though. The ones the software calculated for me have been pretty little. But I know you’re a cheap ass so I’d probably make an estimate.

So this is Vanguard. Can they withhold some of the rolloever to pay the taxes? I just don't want to mess up some of the leg work here as I do my own taxes in Turbotax each year.

Jenson71 · 03-17-2023, 08:13 AM

Quote:

Originally Posted by lewdog

So this is Vanguard. Can they withhold some of the rolloever to pay the taxes? I just don't want to mess up some of the leg work here as I do my own taxes in Turbotax each year.

This Vanguard article indicates that while you can withhold some of the rollover, it would be better to pay an estimated tax out of a nonretirement source like cash savings in order to keep the Roth account at its maximum: https://investor.vanguard.com/invest...rom-an-advisor

So rather than withhold 10%, make a quarterly estimate payment of $2k at the time of the rollover.

**Buehler445** · 03-17-2023, 08:22 AM

Quote:

Originally Posted by lewdog

So this is Vanguard. Can they withhold some of the rolloever to pay the taxes? I just don't want to mess up some of the leg work here as I do my own taxes in Turbotax each year.

They should. But I've never done it so I can't verify 100%, but it is a common thing.

**petegz28** · 03-17-2023, 08:25 AM

Quote:

Originally Posted by lewdog

I'm thinking of doing a ROTH conversion in my wife's IRA account. It's roughly $20k so I'd have to pay taxes on it. Still seems worth it right and would I have to pay estimated taxes on that or can I just roll it into next year's taxes?

Man up! Roll this shit over and prepare to pay your taxes out of a taxable account when you file. WTF would you mess with filing an estimate when in the end you're going to pay whatever it is you have to pay and you have until then to pay it?

**Buehler445** · 03-17-2023, 08:28 AM

Quote:

Originally Posted by Jenson71

This Vanguard article indicates that while you can withhold some of the rollover, it would be better to pay an estimated tax out of a nonretirement source like cash savings in order to keep the Roth account at its maximum: https://investor.vanguard.com/invest...rom-an-advisor

So rather than withhold 10%, make a quarterly estimate payment of $2k at the time of the rollover.

Ah, yeah, that makes some sense the IRS would care how the funding is done.

I think you just print a voucher and mail a check and there should be a place on TurboTax to enter payments.

The other option is to withhold an additional amount on your W-2.

06-27-2016, 11:23 AM
DaFace Kind of a mod Join Date: Aug 2005 Location: Donkey Land Casino cash: $76899	Investing megathread extravaganza A place to talk about investing stuff. Last edited by DaFace; 02-19-2021 at 06:35 PM..
Posts: 52,542

03-16-2023, 07:56 PM	#13357
lewdog Mod Team Join Date: Sep 2011 Location: Valley of the hot as **** Casino cash: $-18100	I'm thinking of doing a ROTH conversion in my wife's IRA account. It's roughly $20k so I'd have to pay taxes on it. Still seems worth it right and would I have to pay estimated taxes on that or can I just roll it into next year's taxes?
Posts: 46,146

03-16-2023, 08:58 PM	#13359
DRU To the Game Join Date: Oct 2003 Casino cash: $7053516	Anybody in here doing anything with real estate syndications and/or private lending? We put some cash into a syndication deal last year that purchased some very large apartment complexes. We get monthly 10% distributions (cashflow), and we also get a K1 that shows paper losses which offset the income we're generating, so the income we make from the deal is completley tax free. Separate from that we are now doing private lending deals as well. So we're earning 10%+ interest payments on those deals monthly, and again, the income from these deals is offset by the K1 losses from the syndication, so it's all tax free income as well. When the syndication closes we would have to recapture the depreciation, but you can do a 1031 exchange into a new syndication just like any other RE deal. This defers the tax, gives us even more K1 paper losses from the new deal, and allows us to continue earning monthly distributions from syndications and private lending deals tax free. When we die our beneficiaries get a "step up" in basis the same as any property we pass to them outright, so they won't have to pay any of the taxes from all those years we've been deferring. They could continue where we left off, and keep moving into new deals to continue getting more tax free cash from them, or they could exit and only pay a small tax on the little gain they may have had after the step up in basis. It's giving us most of the benefits of RE without any of the hassle! I don't have to shop for deals, negotiate, manage properties, service loans, or any of the stuff that comes with RE investing. The only thing we don't get (because we chose the higher cash flow option) is equity growth on the back end when the deal closes. We just get our initial principal back. However, we still have active income as well, so we're taking the tax free passive income we're getting from these deals and throwing it all into a ROTH where we're DCAing into index funds (and some individual stocks.) Of course, that will all be 100% tax free as well, and in theory will give us the growth factor that we aren't getting from the syndication itself. Again, we could choose to take less cash during the holding period and then get part of the equity growth from the syndication, but I prefer the cashflow right now. I'm loving it so far, but would appreciate any feedback others might have that are already further down this road than we are.
Posts: 2,124