Location via proxy:   [ UP ]  
[Report a bug]   [Manage cookies]                
Scribd Logo
Upload

Welcome to Scribd!

  • 39 views

    Suppose One of Your Clients Is Four Years Away From

    Uploaded by

    Miroslav Gegoski
    A client has $2,500 pre-tax income to contribute to either a traditional or Roth IRA. With a traditional IRA, the full amount can be contributed and deducted from taxes now, but distributions in retirement will be taxed. With a Roth IRA, only $1,875 can be contributed after taxes now, but earnings and distributions will not be taxed in retirement. Assuming a 19% tax rate in retirement and 7% annual returns, the client would prefer a Roth IRA since they would not have to pay taxes on withdrawals.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd

    Suppose One of Your Clients Is Four Years Away From

    Uploaded by

    Miroslav Gegoski
    39 views1 page
    A client has $2,500 pre-tax income to contribute to either a traditional or Roth IRA. With a traditional IRA, the full amount can be contributed and deducted from taxes now, but distributions in retirement will be taxed. With a Roth IRA, only $1,875 can be contributed after taxes now, but earnings and distributions will not be taxed in retirement. Assuming a 19% tax rate in retirement and 7% annual returns, the client would prefer a Roth IRA since they would not have to pay taxes on withdrawals.

    Original Description:

    Suppose One of Your Clients is Four Years Away From

    Original Title

    Suppose One of Your Clients is Four Years Away From

    Copyright

    © © All Rights Reserved

    Available Formats

    PDF, TXT or read online from Scribd

    Did you find this document useful?

    Is this content inappropriate?

    A client has $2,500 pre-tax income to contribute to either a traditional or Roth IRA. With a traditional IRA, the full amount can be contributed and deducted from taxes now, but distributions in retirement will be taxed. With a Roth IRA, only $1,875 can be contributed after taxes now, but earnings and distributions will not be taxed in retirement. Assuming a 19% tax rate in retirement and 7% annual returns, the client would prefer a Roth IRA since they would not have to pay taxes on withdrawals.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    39 views1 page

    Suppose One of Your Clients Is Four Years Away From

    Uploaded by

    Miroslav Gegoski
    A client has $2,500 pre-tax income to contribute to either a traditional or Roth IRA. With a traditional IRA, the full amount can be contributed and deducted from taxes now, but distributions in retirement will be taxed. With a Roth IRA, only $1,875 can be contributed after taxes now, but earnings and distributions will not be taxed in retirement. Assuming a 19% tax rate in retirement and 7% annual returns, the client would prefer a Roth IRA since they would not have to pay taxes on withdrawals.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    of 1

    Suppose one of your clients is four years away from #9181

    Suppose one of your clients is four years away from

    Suppose one of your clients is four years away from retirement and has only $ 2,500 in pretax
    income to devote to either a Roth or traditional IRA. The traditional IRA permits investors to
    contribute the full $ 2,500 since contributions to these accounts are tax deductible, but they
    must pay taxes on all future distributions. In contrast, contributions to a Roth IRA are not tax-
    deductible. For example, if a person’s tax rate is 25 percent, an investor is able to contribute
    only $ 1,875 after taxes; however, the earnings of a Roth IRA grow tax- free. Your company has
    decided to waive the one- time set- up fee of $ 50 to open a Roth IRA; however, investors
    opening a traditional IRA must pay the $ 50 setup fee. Assuming that your client anticipates that
    her tax rate will remain at 19 percent in retirement and will earn a stable 7 percent return on her
    investments, will she prefer a traditional or Roth IRA?

    Suppose one of your clients is four years away from

    ANSWER
    http://paperinstant.com/downloads/suppose-one-of-your-clients-is-four-years-away-from/

    1/1
    Powered by TCPDF (www.tcpdf.org)

    You might also like