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401k strategy
I am over 60, still working and contributing to a 401k. Can I take scheduled withdrawals while still contributing? I was considering the tax advantage of not having to pay SS & Medicare if I up my contributions and withdraw money.
Fri Jul 11, 2014 2:03 am
blixet Preferred Member
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Whether or not you are allowed to withdraw from your 401k depends on the plan rules. See the Summary Plan Description for that information. As to avoiding Social Security and Medicare taxes on your income, it will not work. Those taxes are applied to your gross wages before any reduction for contributions to retirement plans. Look at boxes 1, 3, and 5 on your last W-2 form and you will see. Nice try.
Information is more valuable sold than used – Fischer Black
Fri Jul 11, 2014 12:33 pm
oldguy Senior Member
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Nice try.
However at one time that worked, it was probably in 1982 or 83 - the govt fixed that loop-hole with uncharacteristic expedience, LOL.
Fri Jul 11, 2014 1:37 pm
MrNewEngland Full Member
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That never would've crossed my mind to do that. Good thinking.
Fri Jul 11, 2014 2:20 pm
blixet Preferred Member
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Now if you had an S-Corp that would be a different story.
Information is more valuable sold than used – Fischer Black
Fri Jul 11, 2014 5:27 pm
ncolello New Member
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