I'm expecting my taxes to be about the same, maybe higher. I won't have mortgage interest or dependent kids to deduct. What's your experience?
2007-09-08 17:49:26 · 6 answers · asked by diesel_pusher2 3 in Business & Finance ➔ Taxes ➔ United States
I have several clients that have found themselves in the position of making more money than when they were working and having no deductions. They take the standard deduction and that is all. All of those IRAs and 401Ks have done really well and along with their retirement income all of it is taxable. But the real joy comes when they start to collect Social Security and discover that as much as 85% of that is also taxable. Sometimes the Retirement Planners just can't perdict the future as well as they think they can.
2007-09-09 05:48:09 · answer #1 · answered by ? 6 · 0⤊ 0⤋
Most retirees end up with less taxes than when they were working, and are often in a lower bracket, because their income is lower than when they were working. Often by the time someone retires, their kids have been grown for quite a few years and have no longer been dependents - and not infrequently, their mortgages have also been paid off for awhile so they haven't been itemizing - those aren't things that suddenly change at retirement like income usually does.
2007-09-09 05:26:58 · answer #2 · answered by Judy 7 · 0⤊ 0⤋
I'm not retired either. However, I'm not surprised that your taxes would be about the same. You have a lesser chance to of itemizing. By the time that you are retired, your house should be almost paid off. More of your payment is being applied to the principal rather than interest. Property taxes are still an issue though. Also, you don't have any dependents.
2007-09-09 02:04:09 · answer #3 · answered by Steve 6 · 1⤊ 0⤋
Most do not end up in a higher bracket, except for those who have a very high balance in tax deferred accounts (IRA's, 410K's, etc), and are therefore required to take large distributions starting at age 70 1/2. An associate of mine recently complained about being in that situation. I pointed out to him that it was a nice problem to have.
2007-09-09 11:30:52 · answer #4 · answered by r_kav 4 · 0⤊ 0⤋
You should really refer this question to a CPA or a financial planner. it all depends on where you will be getting your income from. Some folks have a pension and/or a military stipend, plus social security, plus 401(k) or IRA, and that can easily add up to be more than your pre-retirement income.
2007-09-08 17:58:24 · answer #5 · answered by dcgirl 7 · 0⤊ 0⤋
I'm still working, can't afford to retire yet.
2007-09-08 17:52:48 · answer #6 · answered by Anonymous · 0⤊ 0⤋