Retirement
Retirees who are eligible for government pensions may have their Social Security benefits reduced due to rules designed to keep people from getting excess payments. Understanding how a government pension can offset Social Security is important for teachers, police officers, firefighters and other public employees who may rely on both…
Virginia does not tax Social Security benefits, which means that retirees in the state can get their Social Security income without state tax deductions. However, other forms of retirement income, such as pensions or distributions from retirement accounts, may still be subject to Virginia state taxes.If you’re worried about taxes…
Transferring funds from a pre-tax retirement account such as an IRA to an after-tax Roth IRA is a move many retirement savers might want to consider. A Roth conversion, as the move is called, has many benefits. It can help you avoid required minimum distributions, or RMDs, in retirement, as…
Correcting 401(k) contribution errors involves identifying the mistake, adjusting future contributions and potentially making retroactive corrections to comply with IRS limits and plan rules. If you discover that you have over-contributed, the first step is to notify your plan administrator.If you need help with your retirement plan, a financial advisor…
Late 401(k) contributions can potentially lead to penalties and missed investment opportunities. Employers must adhere to strict deposit deadlines to comply with IRS regulations and ensure employees’ retirement savings grow as intended. Understanding these deadlines and the consequences of missing them is essential for both employers and employees to maintain…
Managing retirement savings effectively often involves rollovers, which allow investors to move funds from one retirement account to another without incurring taxes or penalties. In a direct rollover, the funds are transferred directly between accounts, while an indirect rollover requires the account holder to receive the funds before depositing them…
Both Roth thrift savings plans (TSPs) and Roth individual retirement accounts (IRAs) can offer significant tax advantages and the potential for tax-free growth, but they cater to different needs and circumstances. Understanding the differences between them can help you make an informed decision about which can be better suited for…
While bank accounts and many other financial accounts can be jointly owned, retirement accounts like IRAs and 401(k)s are inherently individual. That means each person must open and maintain their own retirement account. The IRS does not permit sharing these accounts between spouses or any other individuals. Spousal IRAs represent…
When you make a Roth conversion, the costs will depend on where you live.Converting money to a Roth IRA has a major upside, and a major downside. The benefit is tax-free portfolio growth and income. When you withdraw money from a Roth account in retirement, it will be untaxed and…
It is easier to take up to $1,000 out of retirement plan savings to help with an emergency under a new rule from the Internal Revenue Service. The IRS announcement clarifies a 2022 law that aimed to reduce paperwork, costs and delays when savers tap retirement funds to cover unexpected…
