Episode Transcript
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Speaker 1 (00:00):
All these years you've saved up planning for a secure retirement,
but if you're not careful, it will be the irs
that's living it up when you retire by taxing your
hard earned money. Welcome to the Maggie Tax and Financial
Hour with Robert and Chris Maggie of Maggie Tax Advisory
and Financial Group. With over thirty years of combined experience
in tax savings, income planning, and investment opportunities, Robert and
(00:22):
Chris share advice and tax planning strategies designed to protect
your retirement nest egg from Uncle Sam. Your questions and
comments are welcome during today's program by calling eight one
three three two two twenty five twenty. That's eight one
three three two two twenty five twenty, or visit Maggie
Tax dot com. That's Maggi tax dot com and now
(00:46):
your host for the Maggie Tax Financial Hour on nine
seventy WFLA. Robert and Chris Maggie.
Speaker 2 (00:53):
Welcome everyone, and thanks for joining us today. My name
is Robert Maggie and I'm here with Chris Maggie. You're
listening to the Maggie Tax and Financial Show. Be sure
to visit our website. Maggie tax dot Com. Click on
the retirement calculator. We're going to be talking about this
in every show and see what your retirement tax bill
is going to be if you have an IRA or
a four oh one K. And then also look at
where it says seminars. We are doing seminars every month
(01:15):
on taxes, social Security, and the wills and trust and
register for one. It's a sixty minute seminar. It's no cost,
no obligation. They're all at libraries. We've had fifty sixty
people at ten So if you're interested, give us a
call eight three to three Maggie Tax. I want to
get to the point right now, Chris, because today we're
going to be talking about tax risk for all of you.
(01:37):
There's going to be a lot of things happening in
the next year or so, a lot of people that
we see every day, Chris. The biggest question is what's
your biggest concern and what do they say? They say, taxes.
Speaker 3 (01:47):
That's right, So welcome everyone. I'm Chris, Maggie. Thank you
so much for tuning into our show. Taxes, Taxes, taxes,
that's our biggest expense and people need to be aware
of how the taxes are going to affect your retirement savings,
your future income, and also your investments. So stay tuned
today throughout today's show. Pick up the phone, schedule a
time to meet with us if you have questions. Let's
(02:10):
put together a tax plan, an investment plan, an income
plan for you so we can show you what your
income is going to be in the future, and how
the taxes are going to affect retirement accounts that you
have put away, and how it could be really hurtful
if you don't plan the right way. So pick up
the phone a three to three Maggie Tax, Visit our
website at Maggie tax dot com, and don't forget. Every
Sunday on ABCTV at ten thirty am, tune in for
(02:33):
the half an hour Maggie Tax and Financial Show.
Speaker 2 (02:36):
So nearly all Americans believe a myth, and every time
savers look at their iras, they take part in what
they call the Great American Savings myth, and they believe
that money is theirs. And it's an easy myth to accept.
So when you look at your IRA statement and let's
say you have a balance of five hundred thousand, and
you start thinking of ways you can spend the five
(02:57):
hundred thousand. How much income can you general rate what
trips you're going to might want to take, or where
you want to finance a car or something. Those are
things that go through your mind. But listen to me.
Your account is not worth five hundred thousand. That's because
you're IRA and all qualified accounts have a silent partner,
Uncle Sam and the irs and Uncle Sam owns a
(03:18):
part of your IRA and he's going to collect it
in taxes. And Chris, I think that's the problem right
now that people do not see at the end of
the rainbow as you and I do every day we
talk about this, and then people are just totally shocked, like, Oh,
I don't have that much money. Why would you be shocked?
You know you have to pay this bill. Well, that's
just it.
Speaker 3 (03:36):
I mean, you have a pile of money just sitting
there and it's been growing tax deferred for so many years.
But now it comes to the point where the distribution
phase is right here for you and it's approaching or
you're in it right now. So what do you do?
But think of it this way. If you have a
twenty five percent tax liability, Uncle Sam owns twenty five
percent of that account of that IRA, so that's one
hundred and twenty five thousand dollars. In our example that
(03:58):
we just used, you only own seventy five percent oh
of your IRA, so you only own three hundred and
seventy five thousand worth of it. But so think of
it that way. Is that enough money for you to retire?
Is that enough money that you can generate interest on
so you can supplement that income that you need every
month when you retire. That's the questions that you have.
Those are the questions that we can answer for you.
(04:19):
So pick up the phone, schedule time to meet with us,
because this is very crucial. Can you work, should you work?
Do you need to work? So when we say stop
funding Uncle Sam's retirement, that's exactly what we're speaking about.
Tax deferred savings have become a mainstreay of American retirement plans,
and with it has come the Great American savings myth.
(04:41):
When savers plan based on their IRA account values, their
risk overestimating the amount of assets that they actually have
in retirement because they forget about the tea word. Taxes, taxes, taxes,
So that's why it's so important to meet with us.
Pick up the phone, schedule time to meet with us.
Let's look at your tax plan, your income plaint, and
your investments plan to show you how they all work
(05:04):
together do the best thing for you.
Speaker 2 (05:05):
So what do we do about this? So conversion strategies
are gaining popularity as savers convert their tax deferred assets
to assets with tax free growth. And we get that
question every time, how do we convert our money? Is
it the right thing to do? What's the tax going
to be? And when we run a mock tax return,
we can strategically show you the right way to do it.
The naysayers often can't stomach the large tax bill today,
(05:28):
but they forget that part of their IRA was never
there to begin with. And that's the deal you made
back when you said I'm going to take tax deferral
and pay the taxes later. And I'm sure some of
you are true followers of Dave Ramsey. How many know
Dave Ramsey. Many of you are committed to getting debt
free in all aspects of your finances. But Ramsey and
(05:49):
his followers overlook a huge debt nearly every American carries,
and it's their debt to Uncle Sam. So do you
have funds and qualified accounts? If so, then you are
not debt free. And here's why. When you look at
your IRA statement you see a balance of five hundred thousand,
and you start thinking of how you will manage and
spend that five hundred thousand. But you will forget that
(06:11):
account is not worth five hundred thousand simply because every
IRA and four to one K includes a debt to
Uncle Sam. And you begin paying back that debt the
day you start with drawing funds and they have to
pay taxes on them. And Chris, from a tax standpoint,
you and I see this every day when you do
a mock tax R and then you start adding in
the R and D, it kind of blows these people away.
(06:33):
Well that's just said.
Speaker 3 (06:34):
I mean people are just not aware of what is
really going to come in the front door when they
need their income from those accounts.
Speaker 2 (06:42):
I mean, think about it.
Speaker 3 (06:43):
You know, you retire, you take some security, maybe you
have a pension, but then you have to fill this
income gap. So where do you take your money from?
And most people just say, oh, just take it from
my four one K, or I'll take it from this IRA,
or I'll take it from my husband's IRA. Well, then
again you have to take more out just to net
the amount you need. So what are you doing about it?
That's why we talk about creating an income plan for yourself.
(07:05):
What's an income plan? It's not just taking money out
of those accounts and draining them. Why not put together
buckets of money where you have guaranteed income where you'll
never outlive it. I don't care how long you live.
It'll always pay you, like your own family pension plan.
And you can have other buckets out there that you
can grow and keep growing on a tax defer a basis,
(07:25):
but you don't need to if you can get some
of this money out and pay the taxes now so
you have tax free money in the future. So put
together a plan we can help eight three to three Maggie.
Speaker 2 (07:35):
Tax And one thing we always talk about, the Trump
tax cuts are going to expire in two years, and
the question is what are you doing about it? So
talking today about this, you need to be thinking about
it today and stop planning on it. When the Trump
tax cuts expire. We don't know what the tax bill
is going to be. So taxes are your biggest debt
to Uncle Sam, and you have to remember that you
(07:57):
owe money. Everyone out there does. In truth. Do you
pay back the debt with interest? After all, you decided
to defer taxes on your IRA contribution, which was a
good thing, but you're paying taxes on the contributions and
your account growth. So think about it. Grow, grow, grow,
that's the message, right, Chris, Grow, grow, grow. But at
the end of that, guess what you have. You've got
(08:18):
a big oak tree with a lot of branches and
those are going to be taxes you're going to pay.
And that's just it.
Speaker 3 (08:23):
So that's why we have and we say each and
every day those accounts that are infected with taxes. So
who wants to be infected with something not good things
if it comes to your health or even taxes? Right,
So what do you do about it? You have to
diffuse the tax time bomb. And that's what we can
show you how to do. What if you do a
strategic rollout, What if you're able to come up with
some tax saving strategies to offset the tax and create
(08:46):
a tax deduction? Would you want to know? Absolutely? But
most advisors out there don't care. They don't care about
the rest of the story and the rest of the
story is taxes. Anybody can can have your account grow.
You can do it yourself. That's what it's not about.
It's about the end of the story and when you
start taking a distribution, how much you're gonna pay Uncle Sam.
(09:08):
So pick up the phone, schedule time to meet with us.
We can do the investment planning. We could put together
an income plan and show you how it's going to
relate to your taxes. We could put together a tax
plan and show you exactly what you're gonna pay in tax.
We have a client last week and it was great.
We've been clients with us for five years and they said, well,
how do we start taking money out?
Speaker 2 (09:27):
What's it going to look like. Well?
Speaker 3 (09:28):
I showed them the sole security that's going to come in.
I showed them the small pension that's going to come in.
I showed them how to take their accounts from the
right buckets of money. And guess what they're gonna be
in a two percent effective tax rate and they're gonna
get seventy five thousand dollars of guaranteed income coming in
the front door every year.
Speaker 2 (09:44):
For the rest of their life. How cool is that?
Speaker 3 (09:47):
Because they have a tax plan, an income plan, and
investment plan. So pick up the phone, schedule time to
meet with us. Eight three to three Maggie Tax.
Speaker 2 (09:54):
Think of it this way. If you have a twenty
five percent tax liability, you are indebted to Uncle Sam
requorder of your savings. That's one hundred and twenty five
thousand in our example. So tax deferred savings have become
a mainstay of American retirement plans because that's what we
were taught, which means nearly all of you owe a
debt to Uncle Sam, and many of you would benefit
(10:15):
from tax efficient income planning. So make twenty twenty four
and beyond the year you get help. That's why we
do the show. That's why we talk about this and
get out of debt to Uncle Sam. If you're curious
to see Uncle Sam's total share of your IRA, go
to Maggie tax dot com, click on the retirement calculator,
and in thirty seconds you're going to see what your
taxes that you will owe. Eight three to three Maggie Tax.
(10:38):
Visit our website, Maggie tax dot com. Let's talk about taxes,
let's talk about your IRA, and let's make it straight
and easy for you. To understand eight three to three
Maggie Tax, and you're listening to the Maggie Tax and
Financial Show, give us a call eight three to three
Magie Tax.
Speaker 1 (10:58):
Stop planning for Uncle Sam's or timeirement and start planning
for your retirement. As we return to the Maggie Tax
and Financial Hour with your host, father and son Robert
and Chris Maggie. For additional information on how you can
create a tax free retirement, visit Maggie Tax dot com.
That's ma Ggi tax dot com. Or call eight one
(11:19):
three three two two twenty five twenty. That's eight one
three three two two twenty five twenty now your host
for the Maggie Tax and Financial Hour, father and son
from Maggie Tax Advisory and Financial Group, Robert and Chris Maggie.
Speaker 2 (11:35):
Welcome back everyone. You're listening to the Maggie Tax and
Financial Show. I am Robert Maggie and I'm here with
Chris Maggie. And if you're just tuning in, we've been
talking about the misunderstandings that you shouldn't fall victim to.
We talked about no investment account type is safer or
risky than the other, and then diversifying funds does not
dilute your ability to make a profit. So number three,
let's talk about that right now. Chris, transferring funds between
(11:57):
investment accounts, it can be risky and just because your
accounts allow you to transfer funds from one to another,
it doesn't mean that it's always the safe way to go.
And depending on how much is in each account and
how much you plan on transferring, you may end up
paying taxes on the same transferred amount for both accounts.
So before you move your funds around, it's best to
(12:19):
think twice and ask for an expert advice. And Chris,
you and I see this every day. People come in
they well, I had to take money out of this
and they created a tax problem or penalty. Let's talk
about that.
Speaker 3 (12:30):
Well, we see that often and that's something that should
definitely not happen at all. And one of the things
that we do see that happen because the advisor or
the client just really doesn't know. And it's sad that
you put all your trust into the advisor who you
think knows how to do this and they mess up
and they call it. They cause a tax of event.
(12:51):
Give you a quick story. Had a client that came in.
They wanted to roll over their iras and their roth
irays to another institution. So they called their advisor the broker,
and the broker was mad, so they said, you know what,
I'll just send you the money. So guess what they
set send sent the IRA money which is one hundred
percent tax will and the roth IRA money to their
(13:12):
checking account. So the guy had over two hundred thousand
dollars and he is checking account and guess what he did.
He just put into a non qualified investment. And he
came in and met with us and he said, hey,
I have this IRA and have this roth IRA. So
we looked at his statements and I said, well, you
don't have an IRA anymore, you don't have a WROTH
(13:32):
you have this non IRA account. He said no, my
advisor rolled it over, and I said no, it did
not happen that way. So he just created a two
hundred thousand dollars tax liability because the client and the
advisor did not do it the right way. So these
are things we're talking about here. What could have happened
(13:53):
is the advisor should have just put the money in cash.
The new institution should have just sent a form over
it's called the transferform from trustee to trustee to the
old institution, and they could transfer the money over without
a taxable event. So we could have kept his IRA intact.
He could have kept his roth IRA intact and everything
(14:13):
could have went smoothly from there in a new investment.
But that did not happen. So the broker was at fault.
The client was at fault. So both those people did
not know what to do. And that's why we should
seek expert advice. That's why when you come in and meet
with us, we're going to look at your accounts, we're
going to show you what you have, and we're going
to show you how you can transfer the money over
in the right best way for you.
Speaker 2 (14:35):
And the key word there in all the Chris said,
it is misunderstanding and knowledge his power. So don't do
anything until you meet with someone who's qualified to answer
the question, and then then you can proceed and do it,
do it the right way. You feel better because what
Chris just explained. The client was very upset. He was
mad at the advisor and he was mad that he
didn't go see someone because he heard us on the radio,
(14:55):
he saw us on TV, and he said, at least
you guys understand and explain, because that's up to you, folks.
You've got to make sure that you understand. So you know,
that's the key word. So let's go to number fourth.
Number four. Bonus income and this is important, can be
taxed even after employer deductions. So if you noticed that
your employer has already taken out a portion of your
bonus income for taxes, don't assume that you're out of
(15:19):
the woods. And the rate that they go by may
not be the same as yours. It's very possible that
you would need to pay the difference when tax season
rolls around. So the next time that you get a
bonus paid, just be prepared for the possibility of paying
back a little extra later on. And can I just
bring up a quick point here. We had a lottery winner,
(15:39):
remember talk about that because this was a shocking you
know the result.
Speaker 3 (15:44):
Well, that's just said. It's a perfect case right here.
We experienced this about three years ago. We had a
client that went five million dollars on a scratch off
and they came in and they said, we're so excited.
You know, we want to invest the money. We want
to set up ourselves the right way, and we said okay,
said we have to look at the tax return first
and figure out the taxes paid, and she said, well,
(16:05):
I already paid the taxes. So I looked at the
statement that she provided into twenty five percent tax withholding,
but back then the tax rate was thirty nine point six,
so guess what she still had to pay more in tax.
So she said, no, Chris, I already paid the tax.
And I said you did, but you didn't pay enough.
(16:25):
So they only withheld twenty five percent, but they should
have withheld thirty nine point six. They did not know
that she was in the highest tax bracket at the time.
So this is a perfect example. So whenever you get
a bonus, make sure that you look at the other
income because they whoever's giving you the money, they don't
know your personal tax situation. Filing, they don't know if
(16:47):
you're single, they don't know if you're married, filing jointly,
marriage filing separately, head of household, They don't know all
those things that you need to have availab before you
make sure that you withhold the tax. So this is
so important. So pick up the phone, schedule time meet
with us. Let's look at this for you eight three
three Maggie tax.
Speaker 2 (17:03):
And you just let into number five. Filing taxes earlier
or later doesn't change the payment due date. Regardless of
when you decide to file your taxes, everyone has a
set date on when they need to pay what they owe,
and you can postpone this date by filing early or late.
So don't count on this misunderstanding to work in your favor,
or else you may find yourself scrambling at the last
(17:24):
minute to gather the money for payment. And here's the thing.
Filing most people, I shouldn't say most people. People get
bonuses different times of the year, correct, And what should
be held out is the amount of tax that your
tax liability is. They don't do that. So at the
end of the year, when you get your tax return,
you get all the information and then you put that
on your tax return. Guess what, Just like Chris said,
(17:46):
you think you're in a twenty nine percent tax back
and you're in a thirty nine percent tax bracket. Guess
who has to pay the taxes?
Speaker 3 (17:52):
Chris, you do have. You're still liable. So that's why
it's so important to pick up the phone. Schedule time
to meet with us. We do tax planning, we do
income planning, we do investment planning. Most advisors out there
just deal with investments. That's just you're missing the boat.
Because taxes are our biggest expense. So if you're working
with an advisor right now who is not talking about
strategic rollouts and roth conversions and options for ways for
(18:14):
you to reduce your taxes, then you are the one
who is going to miss out. So pick up the phone,
schedule time to meet with us. Today, we talked about
five personal finance misunderstandings that you should not fall victim too,
and just to summarize what they are, no investment account
type is safer or riskier than another. Number two, diversifying
funds does not necessarily dilute your ability to make a profit.
(18:36):
Number three transferring funds between investment accounts can be risky.
And four bonus income can be taxed even after employer deductions.
And number five we talked about today, filing taxes earlier
or later it doesn't necessarily change the payment due date.
So pick up the phone, schedule time to meet with us.
Visit our website Maggi tax dot com. Eight three to
(18:58):
three Maggie Tax. That's eight three Maggie Tax.
Speaker 1 (19:03):
Stop planning for Uncle Sam's retirement and start planning for
your retirement. As we return to the Maggie Tax and
Financial Hour with your host, father and son Robert and
Chris Maggie. For additional information on how you can create
a tax free retirement, visit Maggie Tax dot com. That's
ma gg I tax dot com. Or call eight one
(19:25):
three three two two twenty five twenty. That's eight one
three three two two twenty five twenty. Now your host
for the Maggie Tax and Financial Hour, father and son
from Maggie Tax Advisory and Financial Group, Robert and Chris Maggie.
Speaker 3 (19:41):
Thank you so much for tuning in today's show. I'm
Chris Maggie, and you listen to the Maggie Tax and
Financial Show. And throughout today's show we're talking about tax planning,
investment planning, income planning, sol security maximization planning. If you
have questions, pick up the phone, schedule time to meet
with us. If you are at sleep at night and
you wake up and you have questions, no one's there
to help you. Pick up the phone in the morning,
(20:02):
schedule time to meet with us because we can definitely
help you and talk through your retirement questions. We have
offics on both sides of the Bay. Feel free to
visit our website Maggie Tax dot com. That's m A
G G I T a X dot com. There's so
much information right there at your fingertips and as well
as our TV show every Sunday on ABC TV at
ten thirty am for the Maggie Tax and Financial Show
(20:25):
ABC every Sunday at ten thirty am. So let's continue
on what we're talking about today, the Maggie Plan, but
also what are asset classes and how does someone go
about investing the right way?
Speaker 2 (20:38):
Well, that's a great question, and the asset classes are many,
so we're going to cover them and talk about how
it's related to taxes because you probably have these and
you don't even know what the actual risk is. So
the first one some asset classes and where they fall
on the tax risk. Let's talk about tax deferred accounts
like four O one ks and iras, and since taxes
(20:59):
will defer to the future on both contributions and growth
in these accounts, one hundred percent of the account value
may be subject to future tax changes. That's what we're
talking about. When the tax cuts expire, what is going
to be your tax rate? So in accordance to that
one hundred percent of the distributions in retirement, they're subject
to the tax regulations and individual situation at the time
(21:22):
of distribution, which could be different. So what did I
just say? There are two things? Okay, you have a
tax deferred account that's growing, but then when you take
it out, it's tax and at what level.
Speaker 3 (21:32):
We don't know. It's a question mark tax rate. Okay,
because tax rates can change and we don't know. It's
called legislative risk. That's the risk that we have, and
that's what we don't know of. So we have to
protect that and combat that if we can, and that's
what we can show you how to do.
Speaker 2 (21:46):
So would you agree individual situation on everyone with tax
deferred accounts is different? Absolutely?
Speaker 3 (21:52):
And that's why we have a client that are taking
money out of a tax deferred account and paying no tax.
Go because there's ways on the tax side of this
thing to look at it to formulate a plan as
a distribution to take income in the most tax efficient way.
Speaker 2 (22:04):
I just lead into my next one here, what about
roth accounts like roth, iras and WROTH for one case,
and the funds in these accounts can be assessed income
tax free in the future since taxes have already been
paid on contributions and growth in a WROTH is not taxed.
Why are we talking about that, because you should be
starting to think about putting money into a tax free
(22:25):
account that they have given us the government to save
for retirement. Pay the tax now at the low rate,
and then have tax free at a rate when you
get retired. And that's what we're talking about. The retirement calculator.
If you don't know what your tax bill is going
to be, now is the time to find out. Go
to my website, Maggie tax dot com. Click on the
retirement Calculator. Folks, In thirty seconds, I can tell you
(22:46):
what your tax bill is going to be. Then you're
going to understand what we're trying to tell you and
come in, pick up the phone and meet with us.
Speaker 3 (22:52):
That's just it, you know, understanding what you have. Many
people have these statements. They get these statements of the mail.
They sometimes don't even open them, they just recycle them
or leave them, and they just get bigger and bigger
and bigger and then someday they go through them and
they don't really know and they just throw them all
away and they don't have no idea what they have.
You might have an account there that's infected with taxes
for so long you have no idea how to diffuse
the tax time bomb. We can show you how you
(23:14):
might have accounts out there that guess what, you're taking
so much risk, you're losing money, You have no idea
what you're invested in. How many people out there are
in that situation. Raise your hand, It's okay, But there's
a solution for it.
Speaker 2 (23:28):
You know.
Speaker 3 (23:28):
That's why we talk about the Maggie Plan, because when
you come in to meet with us, we're going to
talk about the balance sheet. We're going to show you
where your money's at. We're going to show you every
account that you have, what's taxable, what's non taxable, what
type of risk you're currently taking with your money, And
we talk about asset classes. Where are you invested in,
Where should you be invested in? Where do you want
(23:49):
to be invested in? Many people have no idea, but
they can if you work with the right advisor. So
pick up the phone, schedule time to meet with US
eight three three maggie tax schedule time eight three to
three Maggie tax.
Speaker 2 (24:00):
And let me go back to the Wroth account for
a minute, because this protects these accounts from both situational
and legislative future tax changes which we've been talking about.
The government could change tax regulations pertaining to how savers
can contribute. Think about that, because it's written in pencil,
how you withdraw funds, what's going to happen then, So
so with a Wroth account you have tax free income.
(24:21):
That's what you're trying to say for it avoids the
legislative risk that we're talking about it. So let's discuss
non qualified annuities. This is important because the cost basis
in these accounts, they have been taxed and they're not
subject to future tax changes. Why. Because taxes are deferred
to the future on all growth inside these accounts, the
(24:41):
portion of the account value representing growth, it may be
subject to both situational and legislative future tax changes. And Chris,
it goes back to the same two words legislative risk
and future tax changes are how are you how are
you listening out there doing something about this?
Speaker 3 (24:57):
Well that's just said, I mean how when in retirement,
how can you go along and take a distribution to
go on a cruise, or how do you take a
distribution to go help your family? Or how do you
take a distribution to go and travel without knowing what
type of impact these accounts are going to cause you
tax wise, it doesn't make sense. It's like driving in
(25:17):
a car and not knowing if it's going to if
it can stop with a braakes work or not. That's
what you're doing with the formal K or an irate.
You're going through retirement and you have a question mark
tax rate. You don't know what you're going to pay
in taxes. So working with the right advisor, if we
put together the buckets of money in the right way
where you have tax free money and you also have
(25:38):
taxable money, and how to diffuse the tax time bomb
in the most tax division way, that's so important for
you and your family, especially in retirement. So that's why
you need an advisor to work with you and help you.
And we talk about the puzzle, the financial puzzle throughout
the whole show today. It's about the income tax piece puzzle,
the investment tax piece puzzle, the tax puzzle. I mean,
(26:03):
how many know what they're going to pay a tax.
These state planning piece puzzle, what are you doing about it?
So if one of these pieces are missing, you don't
put together. The whole puzzle doesn't work right. So meet
with us, get together. Let's have a conversation eight three
to three MAGI tax, tax planning, income planning, investment planning
and state planning, sold security maximization planning, medicare planning. We
(26:24):
can help a three to three MAGI tax.
Speaker 2 (26:26):
And just remember what we're talking about today. A portion
of your assets coming out of these accounts, they're subject
to some tax regulations at the time of distribution, and
it could be different from tax regulations today. Change. That's
what it's called. So let's talk about what about taxable accounts.
The funds in these accounts, they're taxable every year and
(26:46):
they're subject to tax changes around capital gains like dividends
step up in basis rules, and all distributions of growth
in these accounts are subject to the tax regulations again
at the time of distribution, which could be different from
the tax regulations of today.
Speaker 3 (27:02):
Right, And that's what we're talking about. Those brokerage accounts
that you have or maybe the CDs that you have
at the bank, or you know the types of non
qualified assets. And many people out there are saying, what's
non qualified? That's just exactly it. You need to understand
what's qualified, what's non qualified? Qualified with the government with
the IRS taxable, so non qualified assets, you don't have
(27:23):
to pay one hundred percent on tax on these accounts.
So where are your money, where is your investments? What
are they doing? How is it going to be taxed?
These are the questions that you need to have answers to.
So pick up the phone and schedule time to meet
with us. Let's get together, Let's talk about your concerns.
Let's talk about getting a second opinion for your accounts.
(27:43):
Eight three to three Maggie Tax eight three three Maggie Tax.
Speaker 2 (27:46):
And just a reminder, go to our website Maggie tax
dot com, click on seminars and register for our upcoming seminars.
They're all over Tampa Bay, different locations. All you gotta
do is just click on the one you want and attend.
It's about an hour and a half. So these are
the things that we want to teach you. We want
to help you, we want to make you understand the language,
because that's what's happening out there. There's so much noise,
(28:07):
if you will out there, Chris, the people are totally
confused and they have no idea. You said it before.
We're in a yo yo economy and people lamp when
we say that. But we are.
Speaker 3 (28:15):
Yeah, and you're on your own, and that shouldn't be
the case. But if you have the education and the knowledge,
and you understand what you've done for your retirement and
how it's going to impact you, then guess what. You're
controlling your retirement and you're not in the yoyo economy
where you're on your own. So many people are going
to fall victim to the changes that are about to happen.
Speaker 2 (28:36):
But you don't have to.
Speaker 3 (28:37):
You know, where is it written that you have to
lose twenty thirty forty percent of your account in the
stock market? Where is it written that that's okay? You
don't have to if you don't want to take that risk.
But if you're taking that risk right now, then why
if you don't want to just because you're following the crowd,
you don't have to go down that route. You know,
do you want to retire, you don't have to wait
(28:58):
to sixty two or sixty five seventy. Just because the
Social Security statement gives you those numbers, you can retire
any time. So, but you need to have a plan
to give you the income every month so you don't
have to leave your house if you don't want to.
That's called an income plan. And also an investment plan
that can give you the income you need so you
(29:18):
don't run out of money. And also and then a
tax plan. They make sure that the money you do
receive is not hitting you so hard with taxes. My gosh,
those are three big impacts that you need to be
aware of. And many of our clients who come in
each and every day new clients come in, they have
no idea, but once we put together a plan, it's
(29:39):
like an Aha moment film. They have clarity, they have control,
they understand what they have, and now they're in better
position to enjoy the retirement. So pick up the phone,
schedule time to meet with us. Eight three to three
magi tax. That's eight three to three magi tax.
Speaker 2 (29:54):
And let me leave you with this five ways that
taxes can rise in retirement, and they may apply to
all of you. You can change your tax bracket that's
the most important one. Tax brackets change around you, okay,
and deductions are eliminated. This is big. What's the standard
deduction now? And does that reduce your taxes? And the
way assets are tax changed, meaning you know, capital gain taxes,
(30:16):
you know things like that. New taxes are enacted. This
is happening right now. This is what we call in
two years, the tax cuts are going to expire. Pick
up the phone eight three three Magi Tax. Visit our website,
Maggie tax dot com, click on the seminars. Register for
our seminars on all we're talking about estate planning, tax planning,
social security, and anything else that you want to talk about.
(30:37):
It's up to you. Pick up the phone eight three
to three Magi Tax. They're operator standing by right now.
Don't forget. Tune into our TV show every Sunday on
ABC at ten thirty.
Speaker 1 (30:47):
So.
Speaker 2 (30:47):
Visit our website, Maggie Tax dot com. Click on seminars,
click on the retirement calculator. For offering this to each
and every one of you, it's up to you to
do something about it. Eight three three Maggie Tax, and
visit our website Maggie tax dot com.
Speaker 3 (31:00):
And every Sunday, tune into the Maggie Tax and Financial
Show on ABC TV at ten thirty am. Maggie Tax
dot Com.
Speaker 1 (31:08):
Stop planning for Uncle Sam's retirement and start planning for
your retirement. As we return to the Maggie Tax and
Financial Hour with your host, father and son Robert and
Chris Maggie. For additional information on how you can create
a tax free retirement, visit Maggie Tax dot Com. That's
m a gg I tax dot Com. Or call eight
(31:29):
one three three two two twenty five twenty. That's eight
one three three two two twenty five twenty. Now your
host for the Maggie Tax and Financial Hour, father and
son from Maggie Tax Advisory and Financial Group, Robert and
Chris Maggie.
Speaker 2 (31:45):
Welcome back and thanks for joining us today. My name
is Robert Maggie and I'm here with Chris Maggie, and
today we've been talking about roth conversions, rothfo olwen ks rothiras.
But we're gonna talk about five reasons that you should
not open up a roth. Okay, Number one, this is
a big question, should we get all the time, you
have no earned income so to be eligible to open
up a roth ira or a traditional ira. With a contribution,
(32:08):
a person must have compensation. Wages, salary, commissions, or other
dollars received for personal services all qualify as compensation, and
that's for IRA contribution eligibility. Things that do not qualify
as compensation include pension, an annuity, income, interest, income, capital gains,
or social security benefits. No compensation equals no wroth ira contribution.
(32:33):
This is confusing to a lot of people, Chris, because
people want to put money into tax free accounts. This
is one reason why they can't.
Speaker 3 (32:39):
That's right, So that's why there's some reasons why you
should in some reasons why you shouldn't. So the second
reason why you should not open up a roth ira
is you have too much earned income. At the other
side of the spectrum are individuals who make too much
money to contribute to a wroth ira. There's phase out
limitations in each year. These change. Back in twenty twenty three,
there were two hund from eighteen thousand to two hundred
(33:01):
and twenty eight thousand for those file and married file
and jointly. If you exceeded that amount, then guess what
you cannot contribute to a roth ira. So make sure
you meet with the right advisor. Make sure that you
do proper planning, because if you make too much money,
we can show you some other avenues that you can
contribute to tax free buckets as opposed to a roth
(33:21):
ira exactly.
Speaker 2 (33:22):
Now, another reason here is maybe you need the money soon.
So a person always has access to his roth ira
contributions as we mentioned before, tax and penalty free. But
if you need the money for a big purchase soon,
or if you need the money for daily living expenses,
it might not be well, may not make sense to
go through the process of opening up a roth ira.
And we get these questions all the time, and this
(33:43):
is especially true if you're under age fifty nine and
a half and need access to any earnings that might
accrue within the roth ira. So for those who need
cash now or for a big purchase at some point
in the near future, a non qualified account may be
better option, and we can talk about that with you.
So if managed properly, you're going to have full access
to the principle as well as the earnings and Chris,
(34:05):
that is a big concern of liquidity no matter where
you put your money, for any person at any age
of any amount.
Speaker 3 (34:12):
That's true and that's why when you meet with the
right advisor, we can look at the suitability rules and
also your income and what your discretionary amount is and
your budget and make sure that you have enough money
that you can access. And there's different buckets of money
for different purposes, and when we put together our plans,
we always have liquid buckets available. We know and understand
that emergencies happen and things happen, and you need to
(34:35):
access money. Absolutely, we want to put you in a
situation where to you can succeed and not fall victim
to the penalties or or a situation where you're hurt
in any which way. So that's why it's so important
to meet with the right advisor who understands you and
what you're doing and how you can contribute to these
plans effectively. Another reason why you should not contribute to
a wroth I array is that your beneficiary is a charity.
(34:58):
You know, charities do not pay income tax. A lot
of people don't know that. If your goal is to
leave your IRA to a charity, then definitely do not
fund a wroth IRA. Why should you pay the tax?
Now on that you should open up then an IRA
get a tax deduction, so it benefits you. So the
money that goes to the charities or guess what, tax
free anyway, because they do not pay taxes. You know,
(35:21):
why pay tax on the dollars yourself and go out
of your way to create a tax free income source
for the entity that won't pay taxes anyway. That's what
we're talking about here. Then many people make that mistake,
and many people just really don't understand why. But when
we show them now it makes sense, and.
Speaker 2 (35:36):
You know it's the language. And I'm going to give
you the biggest one right here. You just don't trust
the government to keep its tax free promise. And yes,
tax laws are effectively written in pencil. We talk about
that all the time. And the tax free benefits of
a roth iray could theoretically be stripped away. But if
you think the rules will change in tax re earnings
on wroth iras will be eliminated from the tax code,
(35:57):
then you probably should avoid a wroth ira. And you
know it is our opinion that Congress has tipped its hand.
They love rothiras. Why because you're paying a tax going
in today and you're done. This was evident and secure
two point zero with all the new WROTH options, the
Roth SEP, the Roth Simple, Roth Employer Match, et cetera.
(36:18):
Goes on and on. Roth means tax revenue now for
the government. And that is music to the ears of
a politician. And again when you look at my website
and go to the retirement calculator and you start to
see that you're deferring it to age seventy two or
seventy three. As that account grows, and as the taxes
go higher, you're paying more out of your savings and
(36:40):
you're penalizing savers. Okay, that's the bottom line. And if
you have a large IRA or four oh one k, folks,
it's not all yours. You're funding the government. That's what
you're doing. You're paying Uncle Sam. So start thinking about
converting the right way, keeping the tax low and having
more tax free income down the road. Go to my website,
Maggie tax dot com, look on the retirement calculate and
(37:02):
put the numbers in yourself. It's free and in thirty
seconds thirty seconds, I don't think anyone out there can
do what we're doing in thirty seconds, tell you what
your tax bill is going to be. That's just it.
Speaker 3 (37:11):
Understanding what your tax bill will be, and we can
show you that in thirty seconds. Visit our website at
maggietax dot com upper right hand corner retirement tax bill.
You know many people out there have those iras. They're
infected with taxes. They have no idea how to diffuse
the tax time bomb. We can show you. So today
we talked about roth iras versus wroth four O one case.
(37:32):
We talked about why you should open up a roth
ira immediately, and we also talked about why you should
not open up a roth ira. So, as you see,
there are pros and cons to each and every investment.
So that's why when you talk to somebody, if they're
just talking about one thing, those are transactional advisors. You
want to work with a complete advisor. Someone who's a
(37:54):
fiduciary is gonna do the best thing for you, but
also take out a step further. Someone who has tax
planning background, under stands taxes, income investments, social security maximization,
a state planning. Someone can do complete planning for you.
Why because everything is interchangeable, they all work together. Should
you contribute to a roth ira, Maybe maybe it's right
(38:14):
for you, but not your neighbor. Maybe you should put
together on IRA Why because maybe you should get a
tax deduction on the on the front end, because your
charities are the beneficiaries on the back end. So who knows.
Every situation is different. Pick up the phone, schedule time
to meet with us. We thank you so much for
tuning into our show today. Every Sunday on ABC TV
(38:35):
at ten thirty, tune into the Maggie Tax and Financial
Show A three to three Maggie Tax.
Speaker 2 (38:39):
That's eight three to three Maggie Tax.
Speaker 1 (38:43):
You've been listening to the Maggie Tax and Financial Hour
discussing tax planning investment strategies, presented by Robert and Chris
Maggie from Maggie Tax Advisory and Financial Services with offices
in Hillsboro and Panela's County. Visit Maggie Tax dot com
or call eight one three three two two twenty five
twenty that's eight one three three two two twenty five
(39:05):
twenty and tune in next Saturday at five for the
Maggie Tax and Financial Hour
All these years you've saved up planning for a secure retirement,
but if you're not careful, it will be the irs
that's living it up when you retire by taxing your
hard earned money. Welcome to the Maggie Tax and Financial
Hour with Robert and Chris Maggie of Maggie Tax Advisory
and Financial Group. With over thirty years of combined experience
in tax savings, income planning, and investment opportunities, Robert and
(00:22):
Chris share advice and tax planning strategies designed to protect
your retirement nest egg from Uncle Sam. Your questions and
comments are welcome during today's program by calling eight one
three three two two twenty five twenty. That's eight one
three three two two twenty five twenty, or visit Maggie
Tax dot com. That's Maggi tax dot com and now
(00:46):
your host for the Maggie Tax Financial Hour on nine
seventy WFLA. Robert and Chris Maggie.
Speaker 2 (00:53):
Welcome everyone, and thanks for joining us today. My name
is Robert Maggie and I'm here with Chris Maggie. You're
listening to the Maggie Tax and Financial Show. Be sure
to visit our website. Maggie tax dot Com. Click on
the retirement calculator. We're going to be talking about this
in every show and see what your retirement tax bill
is going to be if you have an IRA or
a four oh one K. And then also look at
where it says seminars. We are doing seminars every month
(01:15):
on taxes, social Security, and the wills and trust and
register for one. It's a sixty minute seminar. It's no cost,
no obligation. They're all at libraries. We've had fifty sixty
people at ten So if you're interested, give us a
call eight three to three Maggie Tax. I want to
get to the point right now, Chris, because today we're
going to be talking about tax risk for all of you.
(01:37):
There's going to be a lot of things happening in
the next year or so, a lot of people that
we see every day, Chris. The biggest question is what's
your biggest concern and what do they say? They say, taxes.
Speaker 3 (01:47):
That's right, So welcome everyone. I'm Chris, Maggie. Thank you
so much for tuning into our show. Taxes, Taxes, taxes,
that's our biggest expense and people need to be aware
of how the taxes are going to affect your retirement savings,
your future income, and also your investments. So stay tuned
today throughout today's show. Pick up the phone, schedule a
time to meet with us if you have questions. Let's
(02:10):
put together a tax plan, an investment plan, an income
plan for you so we can show you what your
income is going to be in the future, and how
the taxes are going to affect retirement accounts that you
have put away, and how it could be really hurtful
if you don't plan the right way. So pick up
the phone a three to three Maggie Tax, Visit our
website at Maggie tax dot com, and don't forget. Every
Sunday on ABCTV at ten thirty am, tune in for
(02:33):
the half an hour Maggie Tax and Financial Show.
Speaker 2 (02:36):
So nearly all Americans believe a myth, and every time
savers look at their iras, they take part in what
they call the Great American Savings myth, and they believe
that money is theirs. And it's an easy myth to accept.
So when you look at your IRA statement and let's
say you have a balance of five hundred thousand, and
you start thinking of ways you can spend the five
(02:57):
hundred thousand. How much income can you general rate what
trips you're going to might want to take, or where
you want to finance a car or something. Those are
things that go through your mind. But listen to me.
Your account is not worth five hundred thousand. That's because
you're IRA and all qualified accounts have a silent partner,
Uncle Sam and the irs and Uncle Sam owns a
(03:18):
part of your IRA and he's going to collect it
in taxes. And Chris, I think that's the problem right
now that people do not see at the end of
the rainbow as you and I do every day we
talk about this, and then people are just totally shocked, like, Oh,
I don't have that much money. Why would you be shocked?
You know you have to pay this bill. Well, that's
just it.
Speaker 3 (03:36):
I mean, you have a pile of money just sitting
there and it's been growing tax deferred for so many years.
But now it comes to the point where the distribution
phase is right here for you and it's approaching or
you're in it right now. So what do you do?
But think of it this way. If you have a
twenty five percent tax liability, Uncle Sam owns twenty five
percent of that account of that IRA, so that's one
hundred and twenty five thousand dollars. In our example that
(03:58):
we just used, you only own seventy five percent oh
of your IRA, so you only own three hundred and
seventy five thousand worth of it. But so think of
it that way. Is that enough money for you to retire?
Is that enough money that you can generate interest on
so you can supplement that income that you need every
month when you retire. That's the questions that you have.
Those are the questions that we can answer for you.
(04:19):
So pick up the phone, schedule time to meet with us,
because this is very crucial. Can you work, should you work?
Do you need to work? So when we say stop
funding Uncle Sam's retirement, that's exactly what we're speaking about.
Tax deferred savings have become a mainstreay of American retirement plans,
and with it has come the Great American savings myth.
(04:41):
When savers plan based on their IRA account values, their
risk overestimating the amount of assets that they actually have
in retirement because they forget about the tea word. Taxes, taxes, taxes,
So that's why it's so important to meet with us.
Pick up the phone, schedule time to meet with us.
Let's look at your tax plan, your income plaint, and
your investments plan to show you how they all work
(05:04):
together do the best thing for you.
Speaker 2 (05:05):
So what do we do about this? So conversion strategies
are gaining popularity as savers convert their tax deferred assets
to assets with tax free growth. And we get that
question every time, how do we convert our money? Is
it the right thing to do? What's the tax going
to be? And when we run a mock tax return,
we can strategically show you the right way to do it.
The naysayers often can't stomach the large tax bill today,
(05:28):
but they forget that part of their IRA was never
there to begin with. And that's the deal you made
back when you said I'm going to take tax deferral
and pay the taxes later. And I'm sure some of
you are true followers of Dave Ramsey. How many know
Dave Ramsey. Many of you are committed to getting debt
free in all aspects of your finances. But Ramsey and
(05:49):
his followers overlook a huge debt nearly every American carries,
and it's their debt to Uncle Sam. So do you
have funds and qualified accounts? If so, then you are
not debt free. And here's why. When you look at
your IRA statement you see a balance of five hundred thousand,
and you start thinking of how you will manage and
spend that five hundred thousand. But you will forget that
(06:11):
account is not worth five hundred thousand simply because every
IRA and four to one K includes a debt to
Uncle Sam. And you begin paying back that debt the
day you start with drawing funds and they have to
pay taxes on them. And Chris, from a tax standpoint,
you and I see this every day when you do
a mock tax R and then you start adding in
the R and D, it kind of blows these people away.
(06:33):
Well that's just said.
Speaker 3 (06:34):
I mean people are just not aware of what is
really going to come in the front door when they
need their income from those accounts.
Speaker 2 (06:42):
I mean, think about it.
Speaker 3 (06:43):
You know, you retire, you take some security, maybe you
have a pension, but then you have to fill this
income gap. So where do you take your money from?
And most people just say, oh, just take it from
my four one K, or I'll take it from this IRA,
or I'll take it from my husband's IRA. Well, then
again you have to take more out just to net
the amount you need. So what are you doing about it?
That's why we talk about creating an income plan for yourself.
(07:05):
What's an income plan? It's not just taking money out
of those accounts and draining them. Why not put together
buckets of money where you have guaranteed income where you'll
never outlive it. I don't care how long you live.
It'll always pay you, like your own family pension plan.
And you can have other buckets out there that you
can grow and keep growing on a tax defer a basis,
(07:25):
but you don't need to if you can get some
of this money out and pay the taxes now so
you have tax free money in the future. So put
together a plan we can help eight three to three Maggie.
Speaker 2 (07:35):
Tax And one thing we always talk about, the Trump
tax cuts are going to expire in two years, and
the question is what are you doing about it? So
talking today about this, you need to be thinking about
it today and stop planning on it. When the Trump
tax cuts expire. We don't know what the tax bill
is going to be. So taxes are your biggest debt
to Uncle Sam, and you have to remember that you
(07:57):
owe money. Everyone out there does. In truth. Do you
pay back the debt with interest? After all, you decided
to defer taxes on your IRA contribution, which was a
good thing, but you're paying taxes on the contributions and
your account growth. So think about it. Grow, grow, grow,
that's the message, right, Chris, Grow, grow, grow. But at
the end of that, guess what you have. You've got
(08:18):
a big oak tree with a lot of branches and
those are going to be taxes you're going to pay.
And that's just it.
Speaker 3 (08:23):
So that's why we have and we say each and
every day those accounts that are infected with taxes. So
who wants to be infected with something not good things
if it comes to your health or even taxes? Right,
So what do you do about it? You have to
diffuse the tax time bomb. And that's what we can
show you how to do. What if you do a
strategic rollout, What if you're able to come up with
some tax saving strategies to offset the tax and create
(08:46):
a tax deduction? Would you want to know? Absolutely? But
most advisors out there don't care. They don't care about
the rest of the story and the rest of the
story is taxes. Anybody can can have your account grow.
You can do it yourself. That's what it's not about.
It's about the end of the story and when you
start taking a distribution, how much you're gonna pay Uncle Sam.
(09:08):
So pick up the phone, schedule time to meet with us.
We can do the investment planning. We could put together
an income plan and show you how it's going to
relate to your taxes. We could put together a tax
plan and show you exactly what you're gonna pay in tax.
We have a client last week and it was great.
We've been clients with us for five years and they said, well,
how do we start taking money out?
Speaker 2 (09:27):
What's it going to look like. Well?
Speaker 3 (09:28):
I showed them the sole security that's going to come in.
I showed them the small pension that's going to come in.
I showed them how to take their accounts from the
right buckets of money. And guess what they're gonna be
in a two percent effective tax rate and they're gonna
get seventy five thousand dollars of guaranteed income coming in
the front door every year.
Speaker 2 (09:44):
For the rest of their life. How cool is that?
Speaker 3 (09:47):
Because they have a tax plan, an income plan, and
investment plan. So pick up the phone, schedule time to
meet with us. Eight three to three Maggie Tax.
Speaker 2 (09:54):
Think of it this way. If you have a twenty
five percent tax liability, you are indebted to Uncle Sam
requorder of your savings. That's one hundred and twenty five
thousand in our example. So tax deferred savings have become
a mainstay of American retirement plans because that's what we
were taught, which means nearly all of you owe a
debt to Uncle Sam, and many of you would benefit
(10:15):
from tax efficient income planning. So make twenty twenty four
and beyond the year you get help. That's why we
do the show. That's why we talk about this and
get out of debt to Uncle Sam. If you're curious
to see Uncle Sam's total share of your IRA, go
to Maggie tax dot com, click on the retirement calculator,
and in thirty seconds you're going to see what your
taxes that you will owe. Eight three to three Maggie Tax.
(10:38):
Visit our website, Maggie tax dot com. Let's talk about taxes,
let's talk about your IRA, and let's make it straight
and easy for you. To understand eight three to three
Maggie Tax, and you're listening to the Maggie Tax and
Financial Show, give us a call eight three to three
Magie Tax.
Speaker 1 (10:58):
Stop planning for Uncle Sam's or timeirement and start planning
for your retirement. As we return to the Maggie Tax
and Financial Hour with your host, father and son Robert
and Chris Maggie. For additional information on how you can
create a tax free retirement, visit Maggie Tax dot com.
That's ma Ggi tax dot com. Or call eight one
(11:19):
three three two two twenty five twenty. That's eight one
three three two two twenty five twenty now your host
for the Maggie Tax and Financial Hour, father and son
from Maggie Tax Advisory and Financial Group, Robert and Chris Maggie.
Speaker 2 (11:35):
Welcome back everyone. You're listening to the Maggie Tax and
Financial Show. I am Robert Maggie and I'm here with
Chris Maggie. And if you're just tuning in, we've been
talking about the misunderstandings that you shouldn't fall victim to.
We talked about no investment account type is safer or
risky than the other, and then diversifying funds does not
dilute your ability to make a profit. So number three,
let's talk about that right now. Chris, transferring funds between
(11:57):
investment accounts, it can be risky and just because your
accounts allow you to transfer funds from one to another,
it doesn't mean that it's always the safe way to go.
And depending on how much is in each account and
how much you plan on transferring, you may end up
paying taxes on the same transferred amount for both accounts.
So before you move your funds around, it's best to
(12:19):
think twice and ask for an expert advice. And Chris,
you and I see this every day. People come in
they well, I had to take money out of this
and they created a tax problem or penalty. Let's talk
about that.
Speaker 3 (12:30):
Well, we see that often and that's something that should
definitely not happen at all. And one of the things
that we do see that happen because the advisor or
the client just really doesn't know. And it's sad that
you put all your trust into the advisor who you
think knows how to do this and they mess up
and they call it. They cause a tax of event.
(12:51):
Give you a quick story. Had a client that came in.
They wanted to roll over their iras and their roth
irays to another institution. So they called their advisor the broker,
and the broker was mad, so they said, you know what,
I'll just send you the money. So guess what they
set send sent the IRA money which is one hundred
percent tax will and the roth IRA money to their
(13:12):
checking account. So the guy had over two hundred thousand
dollars and he is checking account and guess what he did.
He just put into a non qualified investment. And he
came in and met with us and he said, hey,
I have this IRA and have this roth IRA. So
we looked at his statements and I said, well, you
don't have an IRA anymore, you don't have a WROTH
(13:32):
you have this non IRA account. He said no, my
advisor rolled it over, and I said no, it did
not happen that way. So he just created a two
hundred thousand dollars tax liability because the client and the
advisor did not do it the right way. So these
are things we're talking about here. What could have happened
(13:53):
is the advisor should have just put the money in cash.
The new institution should have just sent a form over
it's called the transferform from trustee to trustee to the
old institution, and they could transfer the money over without
a taxable event. So we could have kept his IRA intact.
He could have kept his roth IRA intact and everything
(14:13):
could have went smoothly from there in a new investment.
But that did not happen. So the broker was at fault.
The client was at fault. So both those people did
not know what to do. And that's why we should
seek expert advice. That's why when you come in and meet
with us, we're going to look at your accounts, we're
going to show you what you have, and we're going
to show you how you can transfer the money over
in the right best way for you.
Speaker 2 (14:35):
And the key word there in all the Chris said,
it is misunderstanding and knowledge his power. So don't do
anything until you meet with someone who's qualified to answer
the question, and then then you can proceed and do it,
do it the right way. You feel better because what
Chris just explained. The client was very upset. He was
mad at the advisor and he was mad that he
didn't go see someone because he heard us on the radio,
(14:55):
he saw us on TV, and he said, at least
you guys understand and explain, because that's up to you, folks.
You've got to make sure that you understand. So you know,
that's the key word. So let's go to number fourth.
Number four. Bonus income and this is important, can be
taxed even after employer deductions. So if you noticed that
your employer has already taken out a portion of your
bonus income for taxes, don't assume that you're out of
(15:19):
the woods. And the rate that they go by may
not be the same as yours. It's very possible that
you would need to pay the difference when tax season
rolls around. So the next time that you get a
bonus paid, just be prepared for the possibility of paying
back a little extra later on. And can I just
bring up a quick point here. We had a lottery winner,
(15:39):
remember talk about that because this was a shocking you
know the result.
Speaker 3 (15:44):
Well, that's just said. It's a perfect case right here.
We experienced this about three years ago. We had a
client that went five million dollars on a scratch off
and they came in and they said, we're so excited.
You know, we want to invest the money. We want
to set up ourselves the right way, and we said okay,
said we have to look at the tax return first
and figure out the taxes paid, and she said, well,
(16:05):
I already paid the taxes. So I looked at the
statement that she provided into twenty five percent tax withholding,
but back then the tax rate was thirty nine point six,
so guess what she still had to pay more in tax.
So she said, no, Chris, I already paid the tax.
And I said you did, but you didn't pay enough.
(16:25):
So they only withheld twenty five percent, but they should
have withheld thirty nine point six. They did not know
that she was in the highest tax bracket at the time.
So this is a perfect example. So whenever you get
a bonus, make sure that you look at the other
income because they whoever's giving you the money, they don't
know your personal tax situation. Filing, they don't know if
(16:47):
you're single, they don't know if you're married, filing jointly,
marriage filing separately, head of household, They don't know all
those things that you need to have availab before you
make sure that you withhold the tax. So this is
so important. So pick up the phone, schedule time meet
with us. Let's look at this for you eight three
three Maggie tax.
Speaker 2 (17:03):
And you just let into number five. Filing taxes earlier
or later doesn't change the payment due date. Regardless of
when you decide to file your taxes, everyone has a
set date on when they need to pay what they owe,
and you can postpone this date by filing early or late.
So don't count on this misunderstanding to work in your favor,
or else you may find yourself scrambling at the last
(17:24):
minute to gather the money for payment. And here's the thing.
Filing most people, I shouldn't say most people. People get
bonuses different times of the year, correct, And what should
be held out is the amount of tax that your
tax liability is. They don't do that. So at the
end of the year, when you get your tax return,
you get all the information and then you put that
on your tax return. Guess what, Just like Chris said,
(17:46):
you think you're in a twenty nine percent tax back
and you're in a thirty nine percent tax bracket. Guess
who has to pay the taxes?
Speaker 3 (17:52):
Chris, you do have. You're still liable. So that's why
it's so important to pick up the phone. Schedule time
to meet with us. We do tax planning, we do
income planning, we do investment planning. Most advisors out there
just deal with investments. That's just you're missing the boat.
Because taxes are our biggest expense. So if you're working
with an advisor right now who is not talking about
strategic rollouts and roth conversions and options for ways for
(18:14):
you to reduce your taxes, then you are the one
who is going to miss out. So pick up the phone,
schedule time to meet with us. Today, we talked about
five personal finance misunderstandings that you should not fall victim too,
and just to summarize what they are, no investment account
type is safer or riskier than another. Number two, diversifying
funds does not necessarily dilute your ability to make a profit.
(18:36):
Number three transferring funds between investment accounts can be risky.
And four bonus income can be taxed even after employer deductions.
And number five we talked about today, filing taxes earlier
or later it doesn't necessarily change the payment due date.
So pick up the phone, schedule time to meet with us.
Visit our website Maggi tax dot com. Eight three to
(18:58):
three Maggie Tax. That's eight three Maggie Tax.
Speaker 1 (19:03):
Stop planning for Uncle Sam's retirement and start planning for
your retirement. As we return to the Maggie Tax and
Financial Hour with your host, father and son Robert and
Chris Maggie. For additional information on how you can create
a tax free retirement, visit Maggie Tax dot com. That's
ma gg I tax dot com. Or call eight one
(19:25):
three three two two twenty five twenty. That's eight one
three three two two twenty five twenty. Now your host
for the Maggie Tax and Financial Hour, father and son
from Maggie Tax Advisory and Financial Group, Robert and Chris Maggie.
Speaker 3 (19:41):
Thank you so much for tuning in today's show. I'm
Chris Maggie, and you listen to the Maggie Tax and
Financial Show. And throughout today's show we're talking about tax planning,
investment planning, income planning, sol security maximization planning. If you
have questions, pick up the phone, schedule time to meet
with us. If you are at sleep at night and
you wake up and you have questions, no one's there
to help you. Pick up the phone in the morning,
(20:02):
schedule time to meet with us because we can definitely
help you and talk through your retirement questions. We have
offics on both sides of the Bay. Feel free to
visit our website Maggie Tax dot com. That's m A
G G I T a X dot com. There's so
much information right there at your fingertips and as well
as our TV show every Sunday on ABC TV at
ten thirty am for the Maggie Tax and Financial Show
(20:25):
ABC every Sunday at ten thirty am. So let's continue
on what we're talking about today, the Maggie Plan, but
also what are asset classes and how does someone go
about investing the right way?
Speaker 2 (20:38):
Well, that's a great question, and the asset classes are many,
so we're going to cover them and talk about how
it's related to taxes because you probably have these and
you don't even know what the actual risk is. So
the first one some asset classes and where they fall
on the tax risk. Let's talk about tax deferred accounts
like four O one ks and iras, and since taxes
(20:59):
will defer to the future on both contributions and growth
in these accounts, one hundred percent of the account value
may be subject to future tax changes. That's what we're
talking about. When the tax cuts expire, what is going
to be your tax rate? So in accordance to that
one hundred percent of the distributions in retirement, they're subject
to the tax regulations and individual situation at the time
(21:22):
of distribution, which could be different. So what did I
just say? There are two things? Okay, you have a
tax deferred account that's growing, but then when you take
it out, it's tax and at what level.
Speaker 3 (21:32):
We don't know. It's a question mark tax rate. Okay,
because tax rates can change and we don't know. It's
called legislative risk. That's the risk that we have, and
that's what we don't know of. So we have to
protect that and combat that if we can, and that's
what we can show you how to do.
Speaker 2 (21:46):
So would you agree individual situation on everyone with tax
deferred accounts is different? Absolutely?
Speaker 3 (21:52):
And that's why we have a client that are taking
money out of a tax deferred account and paying no tax.
Go because there's ways on the tax side of this
thing to look at it to formulate a plan as
a distribution to take income in the most tax efficient way.
Speaker 2 (22:04):
I just lead into my next one here, what about
roth accounts like roth, iras and WROTH for one case,
and the funds in these accounts can be assessed income
tax free in the future since taxes have already been
paid on contributions and growth in a WROTH is not taxed.
Why are we talking about that, because you should be
starting to think about putting money into a tax free
(22:25):
account that they have given us the government to save
for retirement. Pay the tax now at the low rate,
and then have tax free at a rate when you
get retired. And that's what we're talking about. The retirement calculator.
If you don't know what your tax bill is going
to be, now is the time to find out. Go
to my website, Maggie tax dot com. Click on the
retirement Calculator. Folks, In thirty seconds, I can tell you
(22:46):
what your tax bill is going to be. Then you're
going to understand what we're trying to tell you and
come in, pick up the phone and meet with us.
Speaker 3 (22:52):
That's just it, you know, understanding what you have. Many
people have these statements. They get these statements of the mail.
They sometimes don't even open them, they just recycle them
or leave them, and they just get bigger and bigger
and bigger and then someday they go through them and
they don't really know and they just throw them all
away and they don't have no idea what they have.
You might have an account there that's infected with taxes
for so long you have no idea how to diffuse
the tax time bomb. We can show you how you
(23:14):
might have accounts out there that guess what, you're taking
so much risk, you're losing money, You have no idea
what you're invested in. How many people out there are
in that situation. Raise your hand, It's okay, But there's
a solution for it.
Speaker 2 (23:28):
You know.
Speaker 3 (23:28):
That's why we talk about the Maggie Plan, because when
you come in to meet with us, we're going to
talk about the balance sheet. We're going to show you
where your money's at. We're going to show you every
account that you have, what's taxable, what's non taxable, what
type of risk you're currently taking with your money, And
we talk about asset classes. Where are you invested in,
Where should you be invested in? Where do you want
(23:49):
to be invested in? Many people have no idea, but
they can if you work with the right advisor. So
pick up the phone, schedule time to meet with US
eight three three maggie tax schedule time eight three to
three Maggie tax.
Speaker 2 (24:00):
And let me go back to the Wroth account for
a minute, because this protects these accounts from both situational
and legislative future tax changes which we've been talking about.
The government could change tax regulations pertaining to how savers
can contribute. Think about that, because it's written in pencil,
how you withdraw funds, what's going to happen then, So
so with a Wroth account you have tax free income.
(24:21):
That's what you're trying to say for it avoids the
legislative risk that we're talking about it. So let's discuss
non qualified annuities. This is important because the cost basis
in these accounts, they have been taxed and they're not
subject to future tax changes. Why. Because taxes are deferred
to the future on all growth inside these accounts, the
(24:41):
portion of the account value representing growth, it may be
subject to both situational and legislative future tax changes. And Chris,
it goes back to the same two words legislative risk
and future tax changes are how are you how are
you listening out there doing something about this?
Speaker 3 (24:57):
Well that's just said, I mean how when in retirement,
how can you go along and take a distribution to
go on a cruise, or how do you take a
distribution to go help your family? Or how do you
take a distribution to go and travel without knowing what
type of impact these accounts are going to cause you
tax wise, it doesn't make sense. It's like driving in
(25:17):
a car and not knowing if it's going to if
it can stop with a braakes work or not. That's
what you're doing with the formal K or an irate.
You're going through retirement and you have a question mark
tax rate. You don't know what you're going to pay
in taxes. So working with the right advisor, if we
put together the buckets of money in the right way
where you have tax free money and you also have
(25:38):
taxable money, and how to diffuse the tax time bomb
in the most tax division way, that's so important for
you and your family, especially in retirement. So that's why
you need an advisor to work with you and help you.
And we talk about the puzzle, the financial puzzle throughout
the whole show today. It's about the income tax piece puzzle,
the investment tax piece puzzle, the tax puzzle. I mean,
(26:03):
how many know what they're going to pay a tax.
These state planning piece puzzle, what are you doing about it?
So if one of these pieces are missing, you don't
put together. The whole puzzle doesn't work right. So meet
with us, get together. Let's have a conversation eight three
to three MAGI tax, tax planning, income planning, investment planning
and state planning, sold security maximization planning, medicare planning. We
(26:24):
can help a three to three MAGI tax.
Speaker 2 (26:26):
And just remember what we're talking about today. A portion
of your assets coming out of these accounts, they're subject
to some tax regulations at the time of distribution, and
it could be different from tax regulations today. Change. That's
what it's called. So let's talk about what about taxable accounts.
The funds in these accounts, they're taxable every year and
(26:46):
they're subject to tax changes around capital gains like dividends
step up in basis rules, and all distributions of growth
in these accounts are subject to the tax regulations again
at the time of distribution, which could be different from
the tax regulations of today.
Speaker 3 (27:02):
Right, And that's what we're talking about. Those brokerage accounts
that you have or maybe the CDs that you have
at the bank, or you know the types of non
qualified assets. And many people out there are saying, what's
non qualified? That's just exactly it. You need to understand
what's qualified, what's non qualified? Qualified with the government with
the IRS taxable, so non qualified assets, you don't have
(27:23):
to pay one hundred percent on tax on these accounts.
So where are your money, where is your investments? What
are they doing? How is it going to be taxed?
These are the questions that you need to have answers to.
So pick up the phone and schedule time to meet
with us. Let's get together, Let's talk about your concerns.
Let's talk about getting a second opinion for your accounts.
(27:43):
Eight three to three Maggie Tax eight three three Maggie Tax.
Speaker 2 (27:46):
And just a reminder, go to our website Maggie tax
dot com, click on seminars and register for our upcoming seminars.
They're all over Tampa Bay, different locations. All you gotta
do is just click on the one you want and attend.
It's about an hour and a half. So these are
the things that we want to teach you. We want
to help you, we want to make you understand the language,
because that's what's happening out there. There's so much noise,
(28:07):
if you will out there, Chris, the people are totally
confused and they have no idea. You said it before.
We're in a yo yo economy and people lamp when
we say that. But we are.
Speaker 3 (28:15):
Yeah, and you're on your own, and that shouldn't be
the case. But if you have the education and the knowledge,
and you understand what you've done for your retirement and
how it's going to impact you, then guess what. You're
controlling your retirement and you're not in the yoyo economy
where you're on your own. So many people are going
to fall victim to the changes that are about to happen.
Speaker 2 (28:36):
But you don't have to.
Speaker 3 (28:37):
You know, where is it written that you have to
lose twenty thirty forty percent of your account in the
stock market? Where is it written that that's okay? You
don't have to if you don't want to take that risk.
But if you're taking that risk right now, then why
if you don't want to just because you're following the crowd,
you don't have to go down that route. You know,
do you want to retire, you don't have to wait
(28:58):
to sixty two or sixty five seventy. Just because the
Social Security statement gives you those numbers, you can retire
any time. So, but you need to have a plan
to give you the income every month so you don't
have to leave your house if you don't want to.
That's called an income plan. And also an investment plan
that can give you the income you need so you
(29:18):
don't run out of money. And also and then a
tax plan. They make sure that the money you do
receive is not hitting you so hard with taxes. My gosh,
those are three big impacts that you need to be
aware of. And many of our clients who come in
each and every day new clients come in, they have
no idea, but once we put together a plan, it's
(29:39):
like an Aha moment film. They have clarity, they have control,
they understand what they have, and now they're in better
position to enjoy the retirement. So pick up the phone,
schedule time to meet with us. Eight three to three
magi tax. That's eight three to three magi tax.
Speaker 2 (29:54):
And let me leave you with this five ways that
taxes can rise in retirement, and they may apply to
all of you. You can change your tax bracket that's
the most important one. Tax brackets change around you, okay,
and deductions are eliminated. This is big. What's the standard
deduction now? And does that reduce your taxes? And the
way assets are tax changed, meaning you know, capital gain taxes,
(30:16):
you know things like that. New taxes are enacted. This
is happening right now. This is what we call in
two years, the tax cuts are going to expire. Pick
up the phone eight three three Magi Tax. Visit our website,
Maggie tax dot com, click on the seminars. Register for
our seminars on all we're talking about estate planning, tax planning,
social security, and anything else that you want to talk about.
(30:37):
It's up to you. Pick up the phone eight three
to three Magi Tax. They're operator standing by right now.
Don't forget. Tune into our TV show every Sunday on
ABC at ten thirty.
Speaker 1 (30:47):
So.
Speaker 2 (30:47):
Visit our website, Maggie Tax dot com. Click on seminars,
click on the retirement calculator. For offering this to each
and every one of you, it's up to you to
do something about it. Eight three three Maggie Tax, and
visit our website Maggie tax dot com.
Speaker 3 (31:00):
And every Sunday, tune into the Maggie Tax and Financial
Show on ABC TV at ten thirty am. Maggie Tax
dot Com.
Speaker 1 (31:08):
Stop planning for Uncle Sam's retirement and start planning for
your retirement. As we return to the Maggie Tax and
Financial Hour with your host, father and son Robert and
Chris Maggie. For additional information on how you can create
a tax free retirement, visit Maggie Tax dot Com. That's
m a gg I tax dot Com. Or call eight
(31:29):
one three three two two twenty five twenty. That's eight
one three three two two twenty five twenty. Now your
host for the Maggie Tax and Financial Hour, father and
son from Maggie Tax Advisory and Financial Group, Robert and
Chris Maggie.
Speaker 2 (31:45):
Welcome back and thanks for joining us today. My name
is Robert Maggie and I'm here with Chris Maggie, and
today we've been talking about roth conversions, rothfo olwen ks rothiras.
But we're gonna talk about five reasons that you should
not open up a roth. Okay, Number one, this is
a big question, should we get all the time, you
have no earned income so to be eligible to open
up a roth ira or a traditional ira. With a contribution,
(32:08):
a person must have compensation. Wages, salary, commissions, or other
dollars received for personal services all qualify as compensation, and
that's for IRA contribution eligibility. Things that do not qualify
as compensation include pension, an annuity, income, interest, income, capital gains,
or social security benefits. No compensation equals no wroth ira contribution.
(32:33):
This is confusing to a lot of people, Chris, because
people want to put money into tax free accounts. This
is one reason why they can't.
Speaker 3 (32:39):
That's right, So that's why there's some reasons why you
should in some reasons why you shouldn't. So the second
reason why you should not open up a roth ira
is you have too much earned income. At the other
side of the spectrum are individuals who make too much
money to contribute to a wroth ira. There's phase out
limitations in each year. These change. Back in twenty twenty three,
there were two hund from eighteen thousand to two hundred
(33:01):
and twenty eight thousand for those file and married file
and jointly. If you exceeded that amount, then guess what
you cannot contribute to a roth ira. So make sure
you meet with the right advisor. Make sure that you
do proper planning, because if you make too much money,
we can show you some other avenues that you can
contribute to tax free buckets as opposed to a roth
(33:21):
ira exactly.
Speaker 2 (33:22):
Now, another reason here is maybe you need the money soon.
So a person always has access to his roth ira
contributions as we mentioned before, tax and penalty free. But
if you need the money for a big purchase soon,
or if you need the money for daily living expenses,
it might not be well, may not make sense to
go through the process of opening up a roth ira.
And we get these questions all the time, and this
(33:43):
is especially true if you're under age fifty nine and
a half and need access to any earnings that might
accrue within the roth ira. So for those who need
cash now or for a big purchase at some point
in the near future, a non qualified account may be
better option, and we can talk about that with you.
So if managed properly, you're going to have full access
to the principle as well as the earnings and Chris,
(34:05):
that is a big concern of liquidity no matter where
you put your money, for any person at any age
of any amount.
Speaker 3 (34:12):
That's true and that's why when you meet with the
right advisor, we can look at the suitability rules and
also your income and what your discretionary amount is and
your budget and make sure that you have enough money
that you can access. And there's different buckets of money
for different purposes, and when we put together our plans,
we always have liquid buckets available. We know and understand
that emergencies happen and things happen, and you need to
(34:35):
access money. Absolutely, we want to put you in a
situation where to you can succeed and not fall victim
to the penalties or or a situation where you're hurt
in any which way. So that's why it's so important
to meet with the right advisor who understands you and
what you're doing and how you can contribute to these
plans effectively. Another reason why you should not contribute to
a wroth I array is that your beneficiary is a charity.
(34:58):
You know, charities do not pay income tax. A lot
of people don't know that. If your goal is to
leave your IRA to a charity, then definitely do not
fund a wroth IRA. Why should you pay the tax?
Now on that you should open up then an IRA
get a tax deduction, so it benefits you. So the
money that goes to the charities or guess what, tax
free anyway, because they do not pay taxes. You know,
(35:21):
why pay tax on the dollars yourself and go out
of your way to create a tax free income source
for the entity that won't pay taxes anyway. That's what
we're talking about here. Then many people make that mistake,
and many people just really don't understand why. But when
we show them now it makes sense, and.
Speaker 2 (35:36):
You know it's the language. And I'm going to give
you the biggest one right here. You just don't trust
the government to keep its tax free promise. And yes,
tax laws are effectively written in pencil. We talk about
that all the time. And the tax free benefits of
a roth iray could theoretically be stripped away. But if
you think the rules will change in tax re earnings
on wroth iras will be eliminated from the tax code,
(35:57):
then you probably should avoid a wroth ira. And you
know it is our opinion that Congress has tipped its hand.
They love rothiras. Why because you're paying a tax going
in today and you're done. This was evident and secure
two point zero with all the new WROTH options, the
Roth SEP, the Roth Simple, Roth Employer Match, et cetera.
(36:18):
Goes on and on. Roth means tax revenue now for
the government. And that is music to the ears of
a politician. And again when you look at my website
and go to the retirement calculator and you start to
see that you're deferring it to age seventy two or
seventy three. As that account grows, and as the taxes
go higher, you're paying more out of your savings and
(36:40):
you're penalizing savers. Okay, that's the bottom line. And if
you have a large IRA or four oh one k, folks,
it's not all yours. You're funding the government. That's what
you're doing. You're paying Uncle Sam. So start thinking about
converting the right way, keeping the tax low and having
more tax free income down the road. Go to my website,
Maggie tax dot com, look on the retirement calculate and
(37:02):
put the numbers in yourself. It's free and in thirty
seconds thirty seconds, I don't think anyone out there can
do what we're doing in thirty seconds, tell you what
your tax bill is going to be. That's just it.
Speaker 3 (37:11):
Understanding what your tax bill will be, and we can
show you that in thirty seconds. Visit our website at
maggietax dot com upper right hand corner retirement tax bill.
You know many people out there have those iras. They're
infected with taxes. They have no idea how to diffuse
the tax time bomb. We can show you. So today
we talked about roth iras versus wroth four O one case.
(37:32):
We talked about why you should open up a roth
ira immediately, and we also talked about why you should
not open up a roth ira. So, as you see,
there are pros and cons to each and every investment.
So that's why when you talk to somebody, if they're
just talking about one thing, those are transactional advisors. You
want to work with a complete advisor. Someone who's a
(37:54):
fiduciary is gonna do the best thing for you, but
also take out a step further. Someone who has tax
planning background, under stands taxes, income investments, social security maximization,
a state planning. Someone can do complete planning for you.
Why because everything is interchangeable, they all work together. Should
you contribute to a roth ira, Maybe maybe it's right
(38:14):
for you, but not your neighbor. Maybe you should put
together on IRA Why because maybe you should get a
tax deduction on the on the front end, because your
charities are the beneficiaries on the back end. So who knows.
Every situation is different. Pick up the phone, schedule time
to meet with us. We thank you so much for
tuning into our show today. Every Sunday on ABC TV
(38:35):
at ten thirty, tune into the Maggie Tax and Financial
Show A three to three Maggie Tax.
Speaker 2 (38:39):
That's eight three to three Maggie Tax.
Speaker 1 (38:43):
You've been listening to the Maggie Tax and Financial Hour
discussing tax planning investment strategies, presented by Robert and Chris
Maggie from Maggie Tax Advisory and Financial Services with offices
in Hillsboro and Panela's County. Visit Maggie Tax dot com
or call eight one three three two two twenty five
twenty that's eight one three three two two twenty five
(39:05):
twenty and tune in next Saturday at five for the
Maggie Tax and Financial Hour
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