Okay, I did a little research and if anything is incorrect please feel free to do the right thing. Now, the following is directed towards dividend income achievers. Of course, this is with the current tax laws.
Married couples filing jointly will not pay any Federal taxes if earned income is less then 95 500 in QUALIFIED dividend income. This assumes the couple has no other source of income, i.e., pensions, SS, rental income, ect ect ect. Any other income other then QUALIFIED dividend income comes into play and all bets are off, taxes are entering the ballgame. Time for a change up, a new game plan. Back to the subject, in order to pay no Federal taxes on Qualified dividend income the couple has to stay in the 15% tax bracket earning 74 900 or less per calender year. In reality, it's 95 500!! By law the married couple gets a standard deduction of 12 600 plus a personal exemption of 4 000 per person for a total of 8 000, per year. Adding the numbers together, 12 600 + 8 000 = 20 600 + 74 900 = 95 500 per year keeps the couple in the 15% tax bracket. If all income is derived from Qualified income then you pay no federal taxes, pretty sweet deal.
This still brings me to the Roth vs Traditional IRA debacle.
Through current tax laws, assuming I'm not understanding this wrong, we can convert monies from Traditional IRA's and tax deferred Kplans to Roth IRA's as long as that amount is equal to or less then the STANDARD deduction of 20 600. So, every year one can transfer 20 600 from tax deferred IRA/Kplan to a Roth IRA and pay no taxes in the process. That's a huge loophole in order to avoid taxes. This makes me think that 401k plans and Traditional IRA's in the accumulation phase is the way to go. Then use the tax laws accordingly to save massive amounts of dollars.
This is directed towards future Qualified Dividend Income.
Married couples filing jointly will not pay any Federal taxes if earned income is less then 95 500 in QUALIFIED dividend income. This assumes the couple has no other source of income, i.e., pensions, SS, rental income, ect ect ect. Any other income other then QUALIFIED dividend income comes into play and all bets are off, taxes are entering the ballgame. Time for a change up, a new game plan. Back to the subject, in order to pay no Federal taxes on Qualified dividend income the couple has to stay in the 15% tax bracket earning 74 900 or less per calender year. In reality, it's 95 500!! By law the married couple gets a standard deduction of 12 600 plus a personal exemption of 4 000 per person for a total of 8 000, per year. Adding the numbers together, 12 600 + 8 000 = 20 600 + 74 900 = 95 500 per year keeps the couple in the 15% tax bracket. If all income is derived from Qualified income then you pay no federal taxes, pretty sweet deal.
This still brings me to the Roth vs Traditional IRA debacle.
Through current tax laws, assuming I'm not understanding this wrong, we can convert monies from Traditional IRA's and tax deferred Kplans to Roth IRA's as long as that amount is equal to or less then the STANDARD deduction of 20 600. So, every year one can transfer 20 600 from tax deferred IRA/Kplan to a Roth IRA and pay no taxes in the process. That's a huge loophole in order to avoid taxes. This makes me think that 401k plans and Traditional IRA's in the accumulation phase is the way to go. Then use the tax laws accordingly to save massive amounts of dollars.
This is directed towards future Qualified Dividend Income.