Under the SECURE Act, can I convert to a Roth IRA?

Q. With the passing of the SECURE Act, is it still possible to convert some of our qualified tax-deferred accounts after we retire to a Roth IRA to bypass the 10-year stretch limit for inherited IRAs? — Planning A. Yours is a great question. Let’s step back for a moment. The SECURE Act is a new law that stands for Setting Every Community Up for Retirement Enhancement Act of 2019. One of the big provisions of the act affected inherited IRAs from a non-spouse. Prior to the SECURE Act, if you inherited a retirement account from someone other than your spouse you could stretch it out over your lifetime, said Bernie Kiely, a certified financial planner and certified public accountant with Kiely C

If I get the pension exclusion, must I withhold taxes?

Q. I will turn 62 in November 2021. I am a retiree with a $44,000 pension as my only income. I currently tax myself at the state level to cover my tax responsibility on the pension. Can I stop the withholding because I will be eligible for the pension exclusion. — Retired A. Let’s take a look at your total tax situation. To do that, we’re going to assume you’re single, and someday, you will receive Social Security benefits. In 2021, the New Jersey pension exclusion will be $75,000 for a single person over age 62 and $100,000 for a married couple, said Bernie Kiely, a certified financial planner and certified public accountant with Kiely Capital Management in Morristown. He said the pension e

The value of dividends when you’re investing long-term

Q. I am not an economist but I think that the value of stocks should be based on the yield by dividends and not necessarily on total return. If I am correct, what is the percentage return in dividends when stock prices remain stagnant? I would expect the markets to go down when the yield gets low relative to the price of stocks. — Non-economist A. It’s often a mystery to understand why some stocks go up and some go down. In reality, a stock is worth whatever someone else is willing to pay for it. In the short-term, stock prices can be a real guessing game, said Bernie Kiely, a certified financial planner and certified public accountant with Kiely Capital Management in Morristown. Want more p

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Kiely Capital Management offers financial planning and investment advice. Serving Central and Northern New Jersey, Yvonne and Bernard (Bernie) Kiely provide over 25 years of experience offering discretionary asset management, retirement planning and income tax preparation. KCM is registered with the State of New Jersey as a Registered Investment Advisor.

 

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