Twitter

LinkedIn

Facebook

Contact: 561-929-1668 or text


The Retirement Planning Institute is a financial think tank ready to solve consumer problems. 

One of the greatest problems we see that can easily be fixed is with Taxable IRA distributions/withdrawals.


Tax-Free Retirement Strategy

The IRS Loves Qualified Funds

Did you know that one of the IRS's largest sources of revenue is tax collected from distributions on $25 Trillion in Qualified Funds; namely IRA's, 401(k)'s, and other Employer Sponsored Qualified Plans? This income tax can wind up costing the average American tax payer hundreds of thousands of dollars in retirement and is completely avoidable with the Roth Magic strategy.


IRA Withdrawal Basics

It's commonly known that Qualified Retirement Funds grow tax-deferred and that distributions are taxed as ordinary income in exchange for a small up-front tax deduction.

What is not well-known is just how much tax a growing IRA might pay over its lifetime and the size of this amount may alarm you.


The IRS begins forcing IRA owners to distribute funds at age 70½, called a Required Minimum Distribution (RMD). The RMD begins at a 3.65% withdrawal rate and increases annually to force more funds out of accounts so the IRS can tax it.


If IRA assets are not exhausted, the IRS can continue to enjoy an endless supply of tax revenue from Qualified Funds. Whether heirs decide to Stretch IRA distributions over their lifetime or cash-out the IRA entirely, the tax revenue continues to flow-in.


IRA Tax Bomb Problem

The shocking truth is that the average IRA owner has a $100,000 retirement account which may pay over $100,000 in taxes over the IRAs lifetime. 


This assumes a conservative 8% growth rate, Required Minimum Distributions (RMDs) taken from age 70-90 taxed at mid-level tax rate of 24%, and heirs cashing-out the IRA at a current top tax rate of 37%. 


As it turns out, the small up-front tax savings received for contributing to Qualified accounts has enormous tax consequences years down the road.


Retirement Account Myths

To make matters worse, tax-payers have been conditioned to believe that they will magically be in a lower tax bracket in retirement in comparison to their working years as if a diminished lifestyle seems attractive or taxes have no chance of significantly increasing with a $20 Trillion U.S. deficit.


Why are Retirement Funds Taxed Like Hard-Earned Money

A final thought to this tragic comedy is to note that the IRS blindly taxes the same amount in retirement as it does during their working years. Why is hard-earned money... Read More


Twitter

LinkedIn

Facebook

Contact: 561-929-1668 or text