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What are the standard limits for "Qualified Plans" (401K's and IRA's, Keogh, 403b, 457 Plan)
- Elective Deferral $17,500
- Catch Up $5,500 ($23,000) Must be 50+
- Max >of$51,000 or 100%
- Max Considered Compensation $255,000
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What is different about the SEP IRA?
- -There is an employer contribution limit of 25% or $51,000.
- -Funded COMPLETELY BY EMPLOYER
- -Age 21 and worked for last 3 of 5 years
- -employee must have earned at least $550
- -Catch up contributions to the IRA that holds the SEP but the holder must be 50 or older, limit is $6,500
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SIMPLE IRA
- For small employers >100
- -Employee must have earned at lease $5000
- -employee limit $12,000
- -catch up $2,500 ($14,500)
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Individual IRA
- Limit of $5,000
- Catch up $1,000
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What are the special restrictions on the Traditional IRA if you ARE covered by a plan at work.
- MAGI
- Single or Head -
- $59< =full deduction, $59 to $69 = partial, $69+ no TAX deduction.
- Married - $95, $115,
- Married filing separately >$10 if above $10, no deduction.
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Traditional IRA - What are the restrictions if you aren't covered at work?
- Single -No restrictions
- Jointly with uncovered spouse - no restrictions
- Spouse covered - $178, $188
- Married filing separately with covered spouse - $10 and $10
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ROTH IRA
- Limit of $5,500
- Catch up $1,000
- Single, Single Head, $112,$127
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Coverdel ESA
Contribution limit of $2,000 / beneficiary under 18
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529 plan
Max of 5 times the gift tax exclusion which is $14,000 for 2013. But you can't give them anything else for 5 years.
Life time typically $300,000
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What is the American Taxpayer Relief Act? (ATRA)
- -$5,250,000 exemption
- -40% tax rate
- -$10,500,000 to heirs tax free
- Even if the estate falls below the 5 mil benchmark, the Generation Skipping Transfer form 706 must be filed.
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Form 1041
- Estate Tax form
- Must be filed on an estate larger than $600
- Form is for tax emposed on income earned by the estate.
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Form 706
form that computes the tax when the estate is transferred.
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Gift Tax Exclusion
$14,000
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Lifetime Gift Tax Exemption
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Generation Skipping Transfer Tax
two generations or unrelated person 37.5 years younger
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Kiddy Tax Exclusion
- -Under 19 or 24 if student
- -No tax for first $1,000
- $1,000 to $2,000 taxed at child rate
- -above $2,000 taxed at parent's rate
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What are the lowest and highest tax brackets?
- -10%
- -MFJ above $450,000 = 39.6%
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What are the Long Term Capital Gains Rates?
- -10% to 15% bracket=0%
- -25% to 35% = 15%
- -39.6% = 20%
Non qualified dividends and SHORT TERM CAPITAL GAINS are taxed as ordinary income
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What is Qualified Dividend Income
- -paid by U.S. Corp or qualified foreign Corp
- -Must meet the holding period. (>60 days on either side of the ex-dividend date)
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Payroll tax rates
- 6.2% for employed
- 12.4% for self employed
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Income subject to Social Security
$113,700
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Child Tax Credit
$1,000 per child
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