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ROTH IRA/TRAD IRA/401K use for Grad School

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oldguy
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quote:
some type of modified adjusted amount


You're right - it's your Modified AGI. The 'modified' part is interest deducted on a student loan, tuition, etc. Check Pub 590, there is a convuluted form to fill out.
Post Thu May 16, 2013 10:48 pm
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Dubya123
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So looking back at all this info... I'm still confused on my graduate school funding.

Can anyone clarify?
Post Fri May 17, 2013 2:18 am
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oldguy
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quote:
I'm still confused on my graduate school funding.

Can anyone clarify?


Yes - leave your 401k/IRA funds invested and draw from your $40k taxable account - sell only as required, you'll pay a 15% capital gains tax on profits.

This applies only if your employer doesn't offer a tuition program - but most do as long as you earn credits in your field of work.
Post Fri May 17, 2013 3:07 am
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Dubya123
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yea i'm positive that my employer does not offer $$.


The more i read on 529 plans.. the more i get confused. Would there be any tax favorability/opportunities with these plans?
Post Fri May 17, 2013 2:10 pm
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oldguy
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No. The 529 allow tax deferred investing and then you pay the tax when you sell - the savings comes from a longterm deferral of taxes on earnings - eg, 18 yrs for a child. But if you invest it this yr and cash it out in a couple yrs, that just means that you pay the tax a couple yrs later.
Post Fri May 17, 2013 2:33 pm
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Dubya123
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You summarize info well. Thanks Oldguy!!
Post Fri May 17, 2013 3:45 pm
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clydewolf
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quote:
Originally posted by Dubya123
You summarize info well. Thanks Oldguy!!

Two IRS Pubs you should read:
- IRS Pub 970, Tax benefits for Education: http://www.irs.gov/pub/irs-pdf/p970.pdf
You may qualify for the Life Timer Learning Tax Credit.
You can also learn about 529 plans and other good things.
- Irs Pub 590, Individual Retirement Arrangements: http://www.irs.gov/pub/irs-pdf/p590.pdf
Post Sat May 18, 2013 12:15 am
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