By Barry C. Picker, CPA/PFS, CFP Question: I hear from some people that I should never borrow money from my 401(k) plan, because the money in the plan ends up being double taxed. Is this accurate? Answer: In a word, no. But before I explain why, let me first emphasize that 401(k) loans are not ideal, […]
by Barry C. Picker, CPA/PFS, CFP (the following is not to be taken too seriously)First, congratulations to the Baltimore Ravens on their Super Bowl victory.But the important question for those of us who do financial planning and investment management is: who, or rather what, are the Baltimore Ravens?Why is this important? It’s important because the Super Bowl […]
by Barry C Picker, CPA/PFS, CFPChutzpah has been defined as the child who kills his parents and then pleads for mercy in Court because he’s an orphan.In a similar vein are the three plaintiffs who sued UBS for the damages that resulted from Plaintiffs’ failure to pay income taxes.It seems that the plaintiffs, who sought class action status […]
by Zesha Auerbach, CPAForm 1099 is the form that payors of income use to inform you of the income paid to you. Most of the form 1099s you receive are fairly straightforward. You receive a 1099 from the bank to report interest income paid to you and you receive a 1099 from any stock that […]
By Barry C Picker, CPA/PFS, CFP Section 72(t) of the Internal Revenue Code provides that there is a 10% additional tax for early withdrawals from a retirement plan. That section also states the exceptions to this 10% tax. The Courts have consistently said that if you meet one of the exceptions, you don’t have […]
by Barry C Picker, CPA/PFS, CFPWhen an individual who clearly has a losing argument on the taxability of his retirement plan distribution goes to Tax Court anyway, maybe it’s because he doesn’t fully understand the law.However, when he loses in Tax Court, appeals to the Court of Appeals and loses there, and then files an appeal […]
I came up with the term “inoculated” a number of years ago. The term arose in a situation where someone was telling me about this “great new tax scheme.” It was clear from the description of the scheme that it would never work, and in fact it didn’t, once the IRS got wind of it. However, when […]
This Sunday’s The Ethicist column in the New York Times contains two questions and answers which, to me, each dealt with the same theme. The first question involved whether a doctor should be reported for unethical behavior when the motivation was revenge, and the second question involved an individual wanting to pay somebody else’s […]
Guaranteeing Loans to a Company Owned by One’s IRA is a Prohibited Transaction Sec. 408(e) of the Internal Revenue Code states that if an IRA engages in a prohibited transaction, as defined in Sec. 4975, it ceases to be an IRA as of the first day of the year in which the […]
A common debate among financial planners when discussing life insurance is whether one should buy term insurance or insurance that provides a cash value. Among the points of discussion on the term side is that one should “buy term and invest the difference,” the difference being the lower term premium in the earlier years. One […]