Related Posts
New to fishbowl can you all spread me some likes
Hi all! I am former federal government. I resigned due to lack of opportunities and growth. I am interested in a couple of Apple service roles within Pay, Care and SDS. Also, Amazon PM roles under Music, Live Sports and Brand Protection. However, with to the current economic conditions is it smarter to focus on fed roles versus Tech. I’ve never had a Tech role. I have a BS Mechanical Engineering and MBA. Any advice would be appreciated.
Many who repatriate are lured by a vibrant startup scene in India that is drawing unprecedented capital from venture and private equity firms and is buoyed by an effervescent market for stocks. But they are also disenchanted with what they perceive as America’s bleak and hopeless immigration landscape, where the wait times for green cards are tortuously long, and the limits on launching startups for newcomers are highly restrictive.
https://www.theinformation.com/articles/the-great-immigrant-resignation-fed-up-indian-tech-workers-ditch-the-american-dream
How do you ask someone to mentor you?
Additional Posts in Consulting
Only 2 more days till Consultant Friday!!
Is PwC SAP team still hiring?
New to Fishbowl?
unlock all discussions on Fishbowl.
Type faster
Told otherwise by whom? You’ll be hit with a 6% tax penalty on the overcontribution forever until it’s fixed. You either recharacterize your excess into a IRA, pull it out, or apply it to a future year. It gets messy when you’ve been dollar cost averaging and adding in funds and buying shares throughout the year. You have to know which specific transaction dates, shares, cost basis, and contribution times you contributed. THEN take all that info, and go through the recharacterization, transfer, or withdrawal process with those specific securities only.
It’s a mess. 0/10. Would not recommend. Do not over contribute if you can avoid it in the future.
Also, not a CPA, but just did this last year and hated every last second of it
I’d wait until told otherwise OP. Let it ride
Can you bump up your 401K contributions for the rest of the year to lower your taxable income? Or maybe with an HSA since you have a new job?
Calculate your MAGI. That’s what the Roth limits are based on. Do you contribute to a pre-tax 401k? If so, that’s a huge deduction to MAGI. Other ways to reduce MAGI include contributions to an [401k, HSA, FSA, Dependent Care FSA], and sell taxable events for a loss
And going forward in future years, simply do a backdoor conversion into your Roth IRA from a Traditional IRA.
I do it in a lump sum, but you can DCA backdoors as well. Caveat is you CANNOT have any funds existing in any active Traditional IRA.
Mechanism for conversion, contribute to your Traditional IRA and then call your brokerage and ask them to convert (usually an overnight thing, so make the contribution and next day call). Vanguard allows you to imitate the conversion online easily
Income is based on your adjusted gross. I would be willing to bet that you are fine.
when I take my pretax 401k contribution out of my “net” of $125,150, I am under the $122k limit so I should be fine then ?
@a2, amazing advice, thanks for the detailed post. Really helped clarify things.
... Roth since I’m now “partially eligible” and I looked online and it means that I can contribute $2750 to a Roth IRA. If you make above $137k you aren’t eligible, if you make below $122k you are 100% eligible and between 122k and 137k you are partially eligible.
Following as I make 113 now but leaving soon for much more. I've been fully finding my IRA ($5500/yr) and didn't know this was a thing.
You probably will, but you have time. Just move to traditional IRA, don't take the deduction. And roll the rest into ROTH.
Yes, if your pre-tax 401k contributions reduce your modified adjusted gross income (MAGI) below the Roth IRA Income limit, then you will be fine
But don’t forget to consider other streams of reported income (e.g., dividends, capital gains if you sold stocks, rent if you own property/investment rentals)