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Is the IRS Stealing Your Retirement?


find that many of today’s retirees have been taught that taxes will be low or negligible in retirement, the idea being that when you retire you drop into a lower tax bracket. Unfortunately that isn’t the case for many of my clients, so it’s important that we plan for taxes – even if you think you will be in a lower tax bracket. Many sources of retirement income have tax consequences. For some retirees, social security benefits are income tax free. With that said, there are certain thresholds that may cause some of your benefit to be taxed. For instance, up to 50% of your social security benefit may be taxed if your income falls between $25,000 and $34,000 for single filers, and $32,000 to $44,000 for joint filers. Up to 85% may be taxed if you make more than $34,000 for single filers and $44,000 for joint filers. 401(k) and IRA accounts are another source of income for retirees. What many don’t realize though is that any withdrawals

from a 401(k) or IRA account are fully income taxable, so it’s imperative that you have a plan for how to take withdrawals. Income or withdrawals from annuities can also affect your taxes. With an annuity that’s funded by pre-tax dollars, the income/ withdrawals are fully income taxable. If an annuity was purchased with after-tax dollars (but is not a Roth), then only the growth is taxable. Lastly, a 10% IRS penalty may be applied if you decide to take a withdrawal from an annuity before the age of 59 ½. Money paid as taxes to the government is never seen again by you or your family, so it’s important to be tax efficient in retirement. In fact, the way you take disbursements from your retirement accounts is just as important as the way you invest them. If your advisor isn’t talking to you about this, lets get you a second opinion! April R. Roberts, J.D.

At Roberts Wealth Management, we realize that you have worked hard for your money. We will work just as hard to help you protect and grow it. Call now for a complimentary 3-Step Review 1650 Highway 6, Suite 250 Sugar Land, TX 77478 (281) 277-0645 DISCLOSURES Investment advisory services offered through Global Financial Private Capital, LLC, an SEC Registered Investment Adviser. SEC registration does not imply any level of skill or training. Any comments regarding safe and secure investments, and guaranteed income streams refer only to fixed insurance products. They do not refer, in any way to securities or investment advisory products. Fixed Insurance and Annuity product guarantees are subject to the claims-paying ability of the issuing company and are not offered by Global Financial Private Capital.

Fort Bend / Katy Business Journal H April 2017


April 2017 - The Business Lifestyle Magazine Digital Edition  

The Business Lifestyle Magazine Digital Edition

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