Tax Deferred Interest

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L1: Tax Deferred InterestI plan to use to accounts to begin with for SEPP withdrawls.Account 680 has 380k, Account 698 has 545k.Distributions calculated using 3.39% for account 680 are20271 and account 698 are 29047.In reading you article on Tax Deferred Interest I’m attempting to get a handle on the income tax to be paid based on year end values of approximately 380k and 545k.I’m unsure of our new tax bracket however we’re looking at about 110k in gross income.With this information is there a way to estimate the taxes I will incur for these two account in advance?Many thanks.2010-02-12 17:26, By: johnnyg, IP: []
L2: Tax Deferred InterestGROSS INCOME HAS NOTHING TO DO WITH INCOME TAXES. FEDERAL INCOME TAXES ARE BASED UPON NET TAXABLE INCOME.Depending upon when you start to take your SEPP 72-T distributions, your 2010 amounts to include in 2010 taxable income could be either the $ 49,318 ANNUAL TOTAL, or a prorated amount for 2010.If we assume the full amount for 2010 and future years as well, the tax on $ 68,000 of TAXABLE INCOME (after deductions and exemptions) is $ 9,381 on a joint return. Since the joint STANDARD DEDUCTION is $ 11,400 on a joint return, and 2 personal exemptions of $ 3,650 each is $ 7,300, that means that you could have $ 86,700 of “gross income” and be at the limit of the 15% tax bracket. Income above that amount is taxed at 25%, so your $ 110,000 would result in TAXABLE INCOME of $ 91,300, and the tax on the extra $ 24,000 would be $ 6,000, or a total of $ 15,381.2010-02-12 18:19, By: dlzallestaxes, IP: []