Dipping into an IRA without Paying a Penalty

 

Typically, withdrawing from a traditional IRA before you reach 59 ½ will earn you a 10% penalty fee, and for good reason—that money is tucked away for retirement, and anything you withdraw loses its ability to make investment gains before you reach a ripe age. In some ways the IRS penalty policy on early withdrawals is meant as a slap on the wrist to steer you from temptation that may jeopardize your financial future.

But life is often unpredictable, and sometimes you need to tap your non-Roth IRA early. Luckily, there are a number of exceptions to the 10% penalty rule.

Many life emergencies allow for an exception:

* If you become permanently disabled and are unable to do substantial gainful activity, you can tap your IRA with no worries about fees.

* High medical bills can be paid with IRA withdrawals if the expenses are not reimbursed by insurance … Read More

Tax Planning: What You Need to Know

At Rapacki + Co., we offer both wealth planning and tax planning. What’s the difference, you ask?

With wealth planning (also called financial planning), we work with you to achieve your long-term financial goals, such as establishing a trust for your child’s college tuition, saving for retirement, or making investment decisions.

Tax planning is a little more fun—that’s where we help you avoid taxes as much as possible. It requires in-depth knowledge of IRS policies, mixed with a dash of creative thinking.

There are simple ways that wealth planning and tax planning can work together. For example, contributing more to your retirement plan through your employer will effectively lower your income—this means you’re paying less taxes, while at the same time dedicating money to the post-career future you’ve been dreaming about.

The truth is that there are many tax-planning strategies you can take advantage of if you know where to look, … Read More

A Business Plan For Life

Why do you need a business plan for life?  We explain how your CPA can help you to navigate life’s “consistent inconsistencies”, and help you create a business plan for life.… Read More