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Tax Mistakes New Retirees Make
Nobody likes tax season. But for new retirees, it can come with a few unwelcome surprises. The rules have changed, the income sources have shifted, and strategies that made sense during your working years may no longer apply. Today, we're looking at some of the biggest tax mistakes retirees make, as discussed in a recent Kiplinger article, and whether these match what we see in the real world.
Important Links: Website: http://www.yourplanningpros.com
Call: 844-707-7381
----more----
Transcript:
Speaker 1 00:01
Nobody likes tax season, and certainly not even Tony Morrow here on playing with the tax man. But for new retirees, it can also come with a few unwelcome surprises. So this week on the podcast, let's talk about tax mistakes new retirees make. Look up in the sky. It's a bird.
Nick 00:17
It's a plane. No, it's the tax man. He may not be a superhero, but Tony Morrow has saved many retirement plans with his extreme knowledge of tax planning strategies. It's time for plan with the tax man.
Speaker 1 00:32
Everybody welcome into the podcast. Thanks for playing tour. Thanks for hanging out with us here on plan with the tax man. If I can get my thoughts together, Tony, it is tax season. And I made the joke there in the intro that not even you like taxes, even though it is obviously something you've been doing for a long time as a CPA and a CFP and an EA of 30 plus years. But it is a it is a hectic, confusing time, for sure, every year, isn't it? It really is. And as we're taping this, we're right in the midst of it. And it seems to me, you know, I mean, we like helping clients, but this truly is, you know, compliance season, you know, and the tax planning has to go on before after this. And so what I find, ever since covid, it seems like taxpayers, our clients anyway, tend to really just kind of put it off. And, you know, we're down to kind of where we prepare tax. Most of our tax returns is March and April. It used to be kind of from mid January on, but yeah, stuff gets out later and everything's slower, yeah,
Tony Mauro 01:31
yep, yeah. So it is a hectic time. And I understand, from a taxpayer standpoint, nobody likes to gather all their stuff and they put it off and yeah, you know,
Speaker 1 01:40
yeah, yeah. So yeah. But we were just talking before we started the podcast, folks, and I was saying, I got to get my stuff over to my CPA. And of course, you know, he was like, Well, why isn't toning your CPA? Well, we're in two different parts of the country, so that's the beauty of the internet. But, but, and he's, you know, he's like, look, my public service announcement to everybody out there is, get them this information as soon as possible, so they have time. And I was like, Okay, I'll get it over there. So I got scolded. So not that, not that we, all, you know, don't do it right from time to time, Tony, but yeah, the sooner we can get it in, the better, right? But it is. Let's talk about tax mistakes for new retirees, specifically on this week's podcast. Okay, because there's a recent article from Kiplinger, we'll put a link into it there, talking about big mistakes that tax retiree new retirees make. And so we'll focus on some of those comments there, and just kind of get your thoughts on it and see how it matches up with what you see, you know, in the real world, right, from just you know, from just an author as an article standpoint, versus what you see in the trenches. So starting the conversation with ignoring the upcoming RMDs, especially if it's your first one, right? Yeah, so you got to be careful here. So talk to me a little bit about that, and some of the stuff you
Tony Mauro 02:49
see, well, some of the stuff we see, and we, you know, base what we see, because a lot of our retail tax clients are retirees or nearing retirement, and so we do see a lot of these things come up, rather than, you know, working with the younger crowd who don't have these problems yet, but they will. But yeah, ignoring the RMDs. I mean, RMD is required minimum distribution, you know, for those that are unaware. And so you you may have an IOU to the government for these, and they're going to come knocking and say, hey, look, once you reach a certain age, at 73 now and 75 for people like me, born after 1960 you need to start taking money out of your tax deferred accounts, because the government says you have to, because they want their their tax. They want their cut. That's right, they want their cut. So it's important that you work with your advisor or figure this out, because there is a large penalty if you delay this past the date you're supposed to do it, so you don't want to get in that situation, and then you have to start taking this money out every year, which creates a little bit of a tax problem, because you're going to, you're going to have some taxes due on this and whatnot. But the kind of, the hidden problem is, is the government will allow you to defer this a little bit past your full retirement age or your RMD age, but you got to be careful, because then you could end up taking two in one year if you wait till the last minute. So you want to plan this carefully,
Speaker 1 04:08
and you can do that the first time, right. Tony, you can push it back on that first one, but to your point, you'd have to take two, and that could cause you to bump a tax bracket if you're not careful, right? If you're
Tony Mauro 04:20
not careful, depending on how much you have to take out, you hate to go into the next tax bracket and pay some extra tax needlessly, when just a little bit of planning could have saved you. That Gotcha. So I would stay, you know, stay ahead of that and work with your advisor. So, you know, these important dates coming up and your options, yeah, you know.
Speaker 1 04:37
And of course, we're off conversion conversations, and are going to can fall into there. And, you know, just again, getting efficient with it and getting handled is just gonna remove some of that stress. And people are always the question always comes back, I don't need it. Why do I gotta take it? Well, we said it a minute ago. The government wants their cut, right, right? They want their cut. There's no way around it. People often ask that question to Tony. They're. Like, how do I get out of the RMDs? It's like, well, you don't, well, I heard a Roth conversion gets me out of it. No, you're just convert. You're still paying the taxes. You're just moving it to an account that you want, that your heirs won't have to deal with, or, you know, later on,
Tony Mauro 05:12
that's right. And Roth conversions really can be a really powerful tool. We use them all throughout the age brackets, depending on your stance on, you know, if you want it, you know, tax free forever, or tax deferred, and worry about it later. But Roth conversions, if done correctly, you know, and you gradually do them over, you know, especially your early retirement years. So really, what that means is, all you're doing is taking money out before your RMD, paying taxes on it now, no penalties, right? And filling up the tax bracket you're in not going into the next one, so you're not paying tax needlessly. And then you got, you've got that money out of Uncle Sam's crosshairs for the tax IOU, because it's, it's now tax free forever, the earnings, and, of course, the principal,
Speaker 1 05:57
yeah, and keep So, yeah, yeah. And definitely keep in mind, I say, like the state you're in, right, their state, lower tax, state issues. You know, people often think about moving as part of that equation when thinking about Roth's right, or the Social Security factors, Irma right, triggering the Irma cost. So just make sure that if you are considering a conversion, you're doing it correctly.
Tony Mauro 06:16
Yeah, and all of those points are good points, because all that stuff comes into play. I get a lot of seniors. Do they get tripped up on the higher Medicare costs, because all of a sudden, you know, their income is way high, and then they get a bigger Medicare bill. Course, it's coming out of their Social Security. And then they're mad. You could file some forms and do some things there to get it back lowered, but it's just more work and more, you know, and it's tricky too, Tony, because it's a two year. Look back. Two year, look back. Yeah, so it's, again, a little planning goes a long way in this area, you know, going back to my first point, all of these require some planning, but it's not difficult. It's just you got to have the conversations.
Speaker 1 06:54
Well, you and I were chatting when we first kicked things off that people are owing a bit this year. You're doing some returns, and people are, you know, and you know, and you were kind of surprised to see a few more people owing, which is interesting, because, you know, we were seeing a lot of reports in February that, you know, with the new tax law changes and things that they expect more people to get, you know, returns and so some confusion, again, around the whole social security piece. So again, as a new retiree, that's our conversation point today, getting blindsided by Social Security taxes is a thing, and unfortunately, the confusion around what happened with the passing of the Oba is still tripping some people up. Right? They did not remove taxation on Social Security. They added a senior deduction, right? Added a senior
Tony Mauro 07:39
deduction, which is helpful for the seniors who don't have a lot of other income outside of Social Security and a few other sources, but it's not as helpful to the higher income retirees, because it does get phased out. They don't mention that. And what happens? What I've been seeing this year as we were talking is I see a lot of people that are at their full retirement age or beyond, and starting to take out and spend some of their money, which is great, sure, but what they're getting tripped up on is, like you said, Social Security is not tax free. It's partially taxable with other income sources. So what's happening is is their their income they're taking from their 401, k's and everything else and their investments is now causing more of their Social Security to be taxed. And generally, people don't have taxes withheld from their social security so that their tax bill goes up. So yeah, again, I think with some planning and some coordination, you can pull money from different accounts in a particular order so you don't have that and,
Speaker 1 08:37
yeah, that's a great point. People, yeah, right. How are you pulling it, and where and when are you pulling it, to avoid those little, I guess, those little tax traps, right? Yeah, these little snafus, you know? And so, yeah, that's a big one as well. Start putting some of these things together, if you you know, if all three of them are happening, correct? And, you know, all of a sudden you got a pretty big, pretty big, good increase in there. Like, What the Hey, it just what happened here? Yeah, exactly. So, all right, and then another one that trips people up, and we'll do one more point here is forgetting to plan for the spouse or The Heirs I mentioned earlier, right? Your heirs might appreciate, you know, you leaving them money, you know, tax efficiently, right? You might think, well, that's their problem. I'm gone. I don't care. They can deal with it. But you might not feel that impact, Tony, but of course, again, like I said, Your loved ones will. And certainly, I think most people, if we're in a position to be more tax efficient with with the legacy, why not do it right? But talk to me about some of the different things dealing with, you know, when planning for the spouse or The Heirs?
Tony Mauro 09:36
Yeah, when, when you have a one of the spouses passing, a lot of people don't think about how this shifts so quickly. Why would you right? 40 years you're finally married filing jointly, all of a sudden, yeah, boom, you know, now you're filing single, which is a different and generally higher tax rate on the same income. Your Medicare thresholds drop. One of your social securities goes bye, bye, and disappear. Years. Now you can file on the higher one, but you're not going to get two. You're going to get one, possibly a pension too. Goes bye, bye, if you didn't select the option right and select the option, we see a lot of people not knowing their options. When they select an option and they hire, they choose the highest option, and then they're dumbfounded when the spouse dies and it goes away, you know, and then really just kind of becomes, you know, more of a burden, I think, if that starts happening, adding to the other you know, things we just talked about with this increased in tax so even though you're gone, you know, your your loved ones might be filling a tax bill, but they probably gonna have the money to do it. But again, they're needlessly wasting money, and all it would take is just a little bit of planning. And most of this stuff isn't going to cost you a dime. Might cost you a little tax if you do Roth conversions, but hopefully you're minimizing that, and you can really save a lot of money, even trickling down to your heirs if you if you pass away.
Speaker 1 10:57
Yeah, and I think again, tax efficiency comes into the conversation. You know, we talked many times here on the podcast about the removal of the stretch IRA, right? So when leaving money, if you've got that IRA, you gotta, you know, we'll just make it easy. Math here, you got that million bucks, then an IRA, and you want to leave it to whomever, unless it's going to the spouse that's going to have to be taken out in 10 years. Now, because they got rid of the stretch Ira used to could go to the kids, and the kids could stretch it out over their lifetime. They can't do that anymore, right? But if it goes to the spouse, right? It becomes basically their own IRA. So in that regard, that's still fine.
Tony Mauro 11:30
That's still fine, yeah, and at least you can, you know, stretch it out a little bit, type of thing. But like in, in my father's case, he's still living. He's got a rollover IRA, and his spouse is gone. My mom is gone, and so we will, you know, if he's got any left in that, we'll have to take that out over the next 10 years, right? And pay our taxes.
Speaker 1 11:47
Finally, speaking of the government finally gave you guys guidelines on that, right? They put that into play, what, five years ago, and they're just now, you know, the last, last maybe year and year and a half, they're going, Okay, here's what we meant,
Tony Mauro 12:00
yeah, I think the whole covid thing affected a lot of that, you know, and they're just kind of starting to get back on their feet a little bit with that. And, you know, yeah, we're just now getting guidance on that. So it's still kind of a weird area, murky
Speaker 1 12:12
waters, yeah, yeah. So again, there's lots of different things you need to think about when leaving, you know, planning for a spouse. And again, we're talking about taxation today, obviously leaving a legacy. In general, there's a lot of things to think about, but just tax mistakes, new retires. New retirees can sometimes trip up on the big one being ignoring those RMDs that we talked about, Roth conversions not done at all or done wrong, and, of course, getting blindsided by Social Security. So if any of those things are pain points that you're concerned about make sure you're having a conversation tax mistakes and retirement are rarely about being careless Tony. They're just usually about not knowing what you didn't know, right?
Tony Mauro 12:49
Not knowing what you didn't know. And yes, and I would you know, strongly suggest now you do have a little bit of information those that are listening, but it's one of the things that an advisor who's a tax guy or gal has to talk about, versus maybe, you know, someone that doesn't, is the tax efficiency of how you're going to plan and, you know, take money from your retirement.
Speaker 1 13:12
Yeah, a lot of financial professionals are like, Hey, let's make sure you consult with your CPA. You know, whenever you're, you know, whatever these things that we're doing. And don't get me wrong, a lot of financial advisors have a lot of tax knowledge, they do, but you have both, because your CPA and CFP, right? So, you know, that's you kind of have everything under one roof there. So if you need some help, you know, again, get some help. Because the good news about all of this, right? Is a lot of this stuff is avoidable. With a little planning and a little bit of guidance, you can kind of knock some of this stuff out. So if you need some help, reach out to Tony and his team at your planning pros.com that's your planning pros.com he's got 30 years of experience plus helping people with all of this stuff. So you know, start planning with the tax man today at your planning pros.com and don't forget to subscribe to us on Apple or Spotify or whatever podcasting app you like using. Just type that into the search box, plan with the tax man, or just again, go to his website. Your planning pros.com. Tony, thanks for hanging out. Breaking it down. I will let you dive back into your stack of taxes to work on, and we will see you next time, my friend. All right, we'll
Tony Mauro 14:14
see you next time. Thanks.
Walter Storholt 14:21
Securities offered through avantax investment services. SM Member FINRA, SIPC investment advisory services offered through avantax advisory services, insurance services offered through an avantax affiliated Insurance Agency. Investment strategies discussed in this episode may not be suitable for all investors. Please consult with a financial professional.
Securities offered through Avantax Investment Services SM, member FINRA, SIPC. Investment advisory services offered through Avantax Advisory Services. Insurance services offered through an Avantax affiliated insurance agency. Investment strategies discussed in this episode may not be suitable for all investors. Please consult with a financial professional.
View all episodes
By Tony Mauro
5
11 ratings
Nobody likes tax season. But for new retirees, it can come with a few unwelcome surprises. The rules have changed, the income sources have shifted, and strategies that made sense during your working years may no longer apply. Today, we're looking at some of the biggest tax mistakes retirees make, as discussed in a recent Kiplinger article, and whether these match what we see in the real world.
Important Links: Website: http://www.yourplanningpros.com
Call: 844-707-7381
----more----
Transcript:
Speaker 1 00:01
Nobody likes tax season, and certainly not even Tony Morrow here on playing with the tax man. But for new retirees, it can also come with a few unwelcome surprises. So this week on the podcast, let's talk about tax mistakes new retirees make. Look up in the sky. It's a bird.
Nick 00:17
It's a plane. No, it's the tax man. He may not be a superhero, but Tony Morrow has saved many retirement plans with his extreme knowledge of tax planning strategies. It's time for plan with the tax man.
Speaker 1 00:32
Everybody welcome into the podcast. Thanks for playing tour. Thanks for hanging out with us here on plan with the tax man. If I can get my thoughts together, Tony, it is tax season. And I made the joke there in the intro that not even you like taxes, even though it is obviously something you've been doing for a long time as a CPA and a CFP and an EA of 30 plus years. But it is a it is a hectic, confusing time, for sure, every year, isn't it? It really is. And as we're taping this, we're right in the midst of it. And it seems to me, you know, I mean, we like helping clients, but this truly is, you know, compliance season, you know, and the tax planning has to go on before after this. And so what I find, ever since covid, it seems like taxpayers, our clients anyway, tend to really just kind of put it off. And, you know, we're down to kind of where we prepare tax. Most of our tax returns is March and April. It used to be kind of from mid January on, but yeah, stuff gets out later and everything's slower, yeah,
Tony Mauro 01:31
yep, yeah. So it is a hectic time. And I understand, from a taxpayer standpoint, nobody likes to gather all their stuff and they put it off and yeah, you know,
Speaker 1 01:40
yeah, yeah. So yeah. But we were just talking before we started the podcast, folks, and I was saying, I got to get my stuff over to my CPA. And of course, you know, he was like, Well, why isn't toning your CPA? Well, we're in two different parts of the country, so that's the beauty of the internet. But, but, and he's, you know, he's like, look, my public service announcement to everybody out there is, get them this information as soon as possible, so they have time. And I was like, Okay, I'll get it over there. So I got scolded. So not that, not that we, all, you know, don't do it right from time to time, Tony, but yeah, the sooner we can get it in, the better, right? But it is. Let's talk about tax mistakes for new retirees, specifically on this week's podcast. Okay, because there's a recent article from Kiplinger, we'll put a link into it there, talking about big mistakes that tax retiree new retirees make. And so we'll focus on some of those comments there, and just kind of get your thoughts on it and see how it matches up with what you see, you know, in the real world, right, from just you know, from just an author as an article standpoint, versus what you see in the trenches. So starting the conversation with ignoring the upcoming RMDs, especially if it's your first one, right? Yeah, so you got to be careful here. So talk to me a little bit about that, and some of the stuff you
Tony Mauro 02:49
see, well, some of the stuff we see, and we, you know, base what we see, because a lot of our retail tax clients are retirees or nearing retirement, and so we do see a lot of these things come up, rather than, you know, working with the younger crowd who don't have these problems yet, but they will. But yeah, ignoring the RMDs. I mean, RMD is required minimum distribution, you know, for those that are unaware. And so you you may have an IOU to the government for these, and they're going to come knocking and say, hey, look, once you reach a certain age, at 73 now and 75 for people like me, born after 1960 you need to start taking money out of your tax deferred accounts, because the government says you have to, because they want their their tax. They want their cut. That's right, they want their cut. So it's important that you work with your advisor or figure this out, because there is a large penalty if you delay this past the date you're supposed to do it, so you don't want to get in that situation, and then you have to start taking this money out every year, which creates a little bit of a tax problem, because you're going to, you're going to have some taxes due on this and whatnot. But the kind of, the hidden problem is, is the government will allow you to defer this a little bit past your full retirement age or your RMD age, but you got to be careful, because then you could end up taking two in one year if you wait till the last minute. So you want to plan this carefully,
Speaker 1 04:08
and you can do that the first time, right. Tony, you can push it back on that first one, but to your point, you'd have to take two, and that could cause you to bump a tax bracket if you're not careful, right? If you're
Tony Mauro 04:20
not careful, depending on how much you have to take out, you hate to go into the next tax bracket and pay some extra tax needlessly, when just a little bit of planning could have saved you. That Gotcha. So I would stay, you know, stay ahead of that and work with your advisor. So, you know, these important dates coming up and your options, yeah, you know.
Speaker 1 04:37
And of course, we're off conversion conversations, and are going to can fall into there. And, you know, just again, getting efficient with it and getting handled is just gonna remove some of that stress. And people are always the question always comes back, I don't need it. Why do I gotta take it? Well, we said it a minute ago. The government wants their cut, right, right? They want their cut. There's no way around it. People often ask that question to Tony. They're. Like, how do I get out of the RMDs? It's like, well, you don't, well, I heard a Roth conversion gets me out of it. No, you're just convert. You're still paying the taxes. You're just moving it to an account that you want, that your heirs won't have to deal with, or, you know, later on,
Tony Mauro 05:12
that's right. And Roth conversions really can be a really powerful tool. We use them all throughout the age brackets, depending on your stance on, you know, if you want it, you know, tax free forever, or tax deferred, and worry about it later. But Roth conversions, if done correctly, you know, and you gradually do them over, you know, especially your early retirement years. So really, what that means is, all you're doing is taking money out before your RMD, paying taxes on it now, no penalties, right? And filling up the tax bracket you're in not going into the next one, so you're not paying tax needlessly. And then you got, you've got that money out of Uncle Sam's crosshairs for the tax IOU, because it's, it's now tax free forever, the earnings, and, of course, the principal,
Speaker 1 05:57
yeah, and keep So, yeah, yeah. And definitely keep in mind, I say, like the state you're in, right, their state, lower tax, state issues. You know, people often think about moving as part of that equation when thinking about Roth's right, or the Social Security factors, Irma right, triggering the Irma cost. So just make sure that if you are considering a conversion, you're doing it correctly.
Tony Mauro 06:16
Yeah, and all of those points are good points, because all that stuff comes into play. I get a lot of seniors. Do they get tripped up on the higher Medicare costs, because all of a sudden, you know, their income is way high, and then they get a bigger Medicare bill. Course, it's coming out of their Social Security. And then they're mad. You could file some forms and do some things there to get it back lowered, but it's just more work and more, you know, and it's tricky too, Tony, because it's a two year. Look back. Two year, look back. Yeah, so it's, again, a little planning goes a long way in this area, you know, going back to my first point, all of these require some planning, but it's not difficult. It's just you got to have the conversations.
Speaker 1 06:54
Well, you and I were chatting when we first kicked things off that people are owing a bit this year. You're doing some returns, and people are, you know, and you know, and you were kind of surprised to see a few more people owing, which is interesting, because, you know, we were seeing a lot of reports in February that, you know, with the new tax law changes and things that they expect more people to get, you know, returns and so some confusion, again, around the whole social security piece. So again, as a new retiree, that's our conversation point today, getting blindsided by Social Security taxes is a thing, and unfortunately, the confusion around what happened with the passing of the Oba is still tripping some people up. Right? They did not remove taxation on Social Security. They added a senior deduction, right? Added a senior
Tony Mauro 07:39
deduction, which is helpful for the seniors who don't have a lot of other income outside of Social Security and a few other sources, but it's not as helpful to the higher income retirees, because it does get phased out. They don't mention that. And what happens? What I've been seeing this year as we were talking is I see a lot of people that are at their full retirement age or beyond, and starting to take out and spend some of their money, which is great, sure, but what they're getting tripped up on is, like you said, Social Security is not tax free. It's partially taxable with other income sources. So what's happening is is their their income they're taking from their 401, k's and everything else and their investments is now causing more of their Social Security to be taxed. And generally, people don't have taxes withheld from their social security so that their tax bill goes up. So yeah, again, I think with some planning and some coordination, you can pull money from different accounts in a particular order so you don't have that and,
Speaker 1 08:37
yeah, that's a great point. People, yeah, right. How are you pulling it, and where and when are you pulling it, to avoid those little, I guess, those little tax traps, right? Yeah, these little snafus, you know? And so, yeah, that's a big one as well. Start putting some of these things together, if you you know, if all three of them are happening, correct? And, you know, all of a sudden you got a pretty big, pretty big, good increase in there. Like, What the Hey, it just what happened here? Yeah, exactly. So, all right, and then another one that trips people up, and we'll do one more point here is forgetting to plan for the spouse or The Heirs I mentioned earlier, right? Your heirs might appreciate, you know, you leaving them money, you know, tax efficiently, right? You might think, well, that's their problem. I'm gone. I don't care. They can deal with it. But you might not feel that impact, Tony, but of course, again, like I said, Your loved ones will. And certainly, I think most people, if we're in a position to be more tax efficient with with the legacy, why not do it right? But talk to me about some of the different things dealing with, you know, when planning for the spouse or The Heirs?
Tony Mauro 09:36
Yeah, when, when you have a one of the spouses passing, a lot of people don't think about how this shifts so quickly. Why would you right? 40 years you're finally married filing jointly, all of a sudden, yeah, boom, you know, now you're filing single, which is a different and generally higher tax rate on the same income. Your Medicare thresholds drop. One of your social securities goes bye, bye, and disappear. Years. Now you can file on the higher one, but you're not going to get two. You're going to get one, possibly a pension too. Goes bye, bye, if you didn't select the option right and select the option, we see a lot of people not knowing their options. When they select an option and they hire, they choose the highest option, and then they're dumbfounded when the spouse dies and it goes away, you know, and then really just kind of becomes, you know, more of a burden, I think, if that starts happening, adding to the other you know, things we just talked about with this increased in tax so even though you're gone, you know, your your loved ones might be filling a tax bill, but they probably gonna have the money to do it. But again, they're needlessly wasting money, and all it would take is just a little bit of planning. And most of this stuff isn't going to cost you a dime. Might cost you a little tax if you do Roth conversions, but hopefully you're minimizing that, and you can really save a lot of money, even trickling down to your heirs if you if you pass away.
Speaker 1 10:57
Yeah, and I think again, tax efficiency comes into the conversation. You know, we talked many times here on the podcast about the removal of the stretch IRA, right? So when leaving money, if you've got that IRA, you gotta, you know, we'll just make it easy. Math here, you got that million bucks, then an IRA, and you want to leave it to whomever, unless it's going to the spouse that's going to have to be taken out in 10 years. Now, because they got rid of the stretch Ira used to could go to the kids, and the kids could stretch it out over their lifetime. They can't do that anymore, right? But if it goes to the spouse, right? It becomes basically their own IRA. So in that regard, that's still fine.
Tony Mauro 11:30
That's still fine, yeah, and at least you can, you know, stretch it out a little bit, type of thing. But like in, in my father's case, he's still living. He's got a rollover IRA, and his spouse is gone. My mom is gone, and so we will, you know, if he's got any left in that, we'll have to take that out over the next 10 years, right? And pay our taxes.
Speaker 1 11:47
Finally, speaking of the government finally gave you guys guidelines on that, right? They put that into play, what, five years ago, and they're just now, you know, the last, last maybe year and year and a half, they're going, Okay, here's what we meant,
Tony Mauro 12:00
yeah, I think the whole covid thing affected a lot of that, you know, and they're just kind of starting to get back on their feet a little bit with that. And, you know, yeah, we're just now getting guidance on that. So it's still kind of a weird area, murky
Speaker 1 12:12
waters, yeah, yeah. So again, there's lots of different things you need to think about when leaving, you know, planning for a spouse. And again, we're talking about taxation today, obviously leaving a legacy. In general, there's a lot of things to think about, but just tax mistakes, new retires. New retirees can sometimes trip up on the big one being ignoring those RMDs that we talked about, Roth conversions not done at all or done wrong, and, of course, getting blindsided by Social Security. So if any of those things are pain points that you're concerned about make sure you're having a conversation tax mistakes and retirement are rarely about being careless Tony. They're just usually about not knowing what you didn't know, right?
Tony Mauro 12:49
Not knowing what you didn't know. And yes, and I would you know, strongly suggest now you do have a little bit of information those that are listening, but it's one of the things that an advisor who's a tax guy or gal has to talk about, versus maybe, you know, someone that doesn't, is the tax efficiency of how you're going to plan and, you know, take money from your retirement.
Speaker 1 13:12
Yeah, a lot of financial professionals are like, Hey, let's make sure you consult with your CPA. You know, whenever you're, you know, whatever these things that we're doing. And don't get me wrong, a lot of financial advisors have a lot of tax knowledge, they do, but you have both, because your CPA and CFP, right? So, you know, that's you kind of have everything under one roof there. So if you need some help, you know, again, get some help. Because the good news about all of this, right? Is a lot of this stuff is avoidable. With a little planning and a little bit of guidance, you can kind of knock some of this stuff out. So if you need some help, reach out to Tony and his team at your planning pros.com that's your planning pros.com he's got 30 years of experience plus helping people with all of this stuff. So you know, start planning with the tax man today at your planning pros.com and don't forget to subscribe to us on Apple or Spotify or whatever podcasting app you like using. Just type that into the search box, plan with the tax man, or just again, go to his website. Your planning pros.com. Tony, thanks for hanging out. Breaking it down. I will let you dive back into your stack of taxes to work on, and we will see you next time, my friend. All right, we'll
Tony Mauro 14:14
see you next time. Thanks.
Walter Storholt 14:21
Securities offered through avantax investment services. SM Member FINRA, SIPC investment advisory services offered through avantax advisory services, insurance services offered through an avantax affiliated Insurance Agency. Investment strategies discussed in this episode may not be suitable for all investors. Please consult with a financial professional.
Securities offered through Avantax Investment Services SM, member FINRA, SIPC. Investment advisory services offered through Avantax Advisory Services. Insurance services offered through an Avantax affiliated insurance agency. Investment strategies discussed in this episode may not be suitable for all investors. Please consult with a financial professional.