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The Slott Report

How to Pay No Tax on Your Capital Gains Using a Free Step-Up in Basis

In order to encourage investments in companies, the tax code provides for the preferential treatment of capital gains (gain on property, such as a stock) if the investment being sold had been held for greater than one year. To illustrate this point, examine the following chart, which summarizes the ordinary income tax rates vs. the long-term capital gains rates that apply at various income levels.

What Should My Brother-in-Law Do With Pre- and After-Tax Retirement Funds?

This week's Slott Report Mailbag answers a consumer's question about how much community property rules tie into his and his wife's retirement accounts and works through Tom's brother-in-law's delicate strategy involving pre- and after-tax retirement funds.

The IRA Definition of Compensation

In order to make an IRA or Roth IRA contribution, you must have “compensation.” What exactly is the definition of compensation for IRA purposes? This article explains the various forms.

3 Self-Directed IRA Issues To Understand ... Before You Take the Plunge

The increase in investment opportunities that are often available in self-directed IRAs can be enticing, but these investments often present unique challenges that should be proactively addressed. The list of challenges is long, but here are three of the most important things to consider before you establish a self-directed IRA accounts.

Community Property and Your IRA: What You Need to Know

What do you get when community property mixes with your IRA? You will discover that the results can be confusing. Here are some facts every IRA owner should know.

The Pitfalls of Transferring an Inherited IRA Account to a Non IRA Bank Account

This week's Slott Report Mailbag examines the RMD rules for business ownership after age 70 1/2 and the pitfalls of transferring an inherited IRA account to a non IRA bank account. As always, we recommend you work with a competent, educated financial advisor to keep your retirement nest egg safe and secure.

Don't Make This Common RMD Mistake - It's a Big Penalty!

With the first group of Baby Boomers turning age 70 ½ this year, there is a whole new group of IRA owners who will begin taking required minimum distributions (RMDs). It is important that they know the rules about aggregating RMDs in order to avoid this frequent mistake made by individuals, advisors, and even IRA custodians and employer plans.

Another RMD Conundrum: How Can I Liquidate My IRA With RMDs Approaching?

This week's Slott Report Mailbag answers a consumer's question on how to handle taxes with charitable gifts and walks a husband through the complicated process of moving IRA funds to a Roth IRA while facing required minimum distributions (RMDs). As always, we recommend you work with a competent, educated financial advisor to keep your retirement nest egg safe and secure.

Exceptions to the Pro-Rata Rule for IRA Distributions

Have you ever made non-deductible IRA contributions? Or, rolled over after-tax funds from your company plan to your IRA? If so, you will want to know about the pro-rata rule. The pro-rata rule is a rule that almost always determines the taxation of an IRA distribution when the IRA owner has any IRA containing after-tax amounts. However, some IRA distributions are not subject to the pro-rata rule. These exceptions may provide an opportunity for you to lower the tax bill that comes with an IRA distribution or conversion.

5 Things You MUST Know (But Probably Don’t) About the “Still Working Exception”

In general, when you reach age 70 ½, you must begin to take required minimum distributions (RMDs) from your retirement accounts. There are, however, a number of exceptions to this rule. One such exception is commonly known as the “still working exception.” Under this exception, you may not have to take a distribution from your 401(k) or similar plan if...

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