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Started By
Message
ways to lower AGI
Posted on 6/26/18 at 2:25 pm
Posted on 6/26/18 at 2:25 pm
Here is my situation...
Beginning this fall, my wife and I will both be employed by a not for profit hospital, which will allow us to to qualify for public student loan forgiveness after 7 years (we already have 3 years of qualifying payments from residency)
I'm trying to find every way I can to lower our AGI to keep our IBR payments as low as possible.
My plan right now is to max out 457 and 403b through our employer. I do not think we qualify for an HSA. The only other way I can think of is tradional IRA contributions.
We are currently renting, but plan on buying a house late spring/early summer.
Are there any other avenues I am missing?
I appreciate any advice
Beginning this fall, my wife and I will both be employed by a not for profit hospital, which will allow us to to qualify for public student loan forgiveness after 7 years (we already have 3 years of qualifying payments from residency)
I'm trying to find every way I can to lower our AGI to keep our IBR payments as low as possible.
My plan right now is to max out 457 and 403b through our employer. I do not think we qualify for an HSA. The only other way I can think of is tradional IRA contributions.
We are currently renting, but plan on buying a house late spring/early summer.
Are there any other avenues I am missing?
I appreciate any advice
4
Posted on 6/26/18 at 2:41 pm to GEAUXT
Do you have any dependents?
Posted on 6/26/18 at 2:44 pm to deeprig9
yes, we have 1 child
Posted on 6/26/18 at 2:48 pm to GEAUXT
Could always make less money.
Posted on 6/26/18 at 2:56 pm to GEAUXT
Spending $1 to save $.30 is very rarely advantageous
Posted on 6/26/18 at 3:00 pm to Mingo Was His NameO
quote:
Spending $1 to save $.30 is very rarely advantageous
I don't know what you mean in this instance?
Posted on 6/26/18 at 3:25 pm to southernelite
quote:
Could always make less money.
Posted on 6/26/18 at 3:39 pm to GEAUXT
quote:
I don't know what you mean in this instance?
Maybe his point is don't be so obsessed over trying to reduce your tax burden when you're already doing just about everything you can that has some chance of providing you with a benefit down the road.
For instance you could take some extra college classes and take advantage of the lifetime learning credit (if it's an eligible institution) but in the end you'll come out behind.
Posted on 6/26/18 at 4:12 pm to Powerman
quote:
Maybe his point is don't be so obsessed over trying to reduce your tax burden when you're already doing just about everything you can that has some chance of providing you with a benefit down the road.
That makes sense. I guess I was looking at things more as a way to keep our AGI as low as possible to keep our loan payments as low as possible. The tax advantages were sort of lagniappe, though I know they go hand in hand.
I'm probably over thinking/complicating things, but we're both playing catch up when it comes to savings and retirement right now, and I'm just trying to make sure we keep as much of our paycheck in our own pockets as possible.
Posted on 6/26/18 at 4:27 pm to GEAUXT
quote:
keep our AGI as low as possible
quote:
The tax advantages were sort of lagniappe,
These two things are the same exact thing
Posted on 6/26/18 at 5:36 pm to GEAUXT
quote:
I'm just trying to make sure we keep as much of our paycheck in our own pockets as possible.
You don't do that with deferred salary adjustments
Posted on 6/26/18 at 6:07 pm to Mingo Was His NameO
quote:
These two things are the same exact thing
Not in his case. Public interest student loan forgiveness it complete tax free forgiveness after 120 on time payments. It doesn't matter whether those payments were $100 or $1,000. As such, to maximize the amount of forgiveness, you want to keep your payment amount as low as possible.
This post was edited on 6/26/18 at 6:10 pm
Posted on 6/26/18 at 6:16 pm to Joshjrn
Yup yup.
Also OP, I don't know what you make but you might want to check the income phase-out for Traditional IRA contributions. I'm just assuming you do OK being doctors it sounds like.
Another way to lower your payments based on AGI is to file separately. If you make enough money you probably don't qualify for most credits/deductions most married couples get anyways.
Also OP, I don't know what you make but you might want to check the income phase-out for Traditional IRA contributions. I'm just assuming you do OK being doctors it sounds like.
Another way to lower your payments based on AGI is to file separately. If you make enough money you probably don't qualify for most credits/deductions most married couples get anyways.
This post was edited on 6/26/18 at 6:17 pm
Posted on 6/26/18 at 6:23 pm to Joshjrn
quote:
Not in his case. Public interest student loan forgiveness it complete tax free forgiveness after 120 on time payments. It doesn't matter whether those payments were $100 or $1,000. As such, to maximize the amount of forgiveness, you want to keep your payment amount as low as possible
I understand that as far as loan forgiveness, but minimizing AGI and maximizing deductions are for all intents and purposes saying the same thing a different way.
Posted on 6/26/18 at 6:53 pm to GEAUXT
quote:
Spending $1 to save $.30 is very rarely advantageous
I don't know what you mean in this instance?
One common example of this are people who buy a house for the mortgage interest deduction when buying a house is maybe not the best decision at the time. Depending on their tax bracket they could be giving the mortgage lender a $1.00 in interest to avoid paying $.30 in taxes, not much of a strategy. Of course there is nothing wrong with buying a house and having a mortgage when it fits into your financial plan.
Posted on 6/26/18 at 7:43 pm to Teddy Ruxpin
quote:
you might want to check the income phase-out for Traditional IRA contributions
You are correct. I actually had to go look it up because I was not sure what the limits are, but we cannot deduct out IRA contributions.
Now I've got read up on back door Roths.
I appreciate the info, fellas
Posted on 6/26/18 at 8:25 pm to EA6B
Or people who try to justify $90K vanity SUVs.
Posted on 6/26/18 at 9:26 pm to GEAUXT
Go to white coat investor website.
Plenty of info on back door roths and a forum where you can ask the same question to some money savvy physicians.
Plenty of info on back door roths and a forum where you can ask the same question to some money savvy physicians.
Posted on 6/26/18 at 9:52 pm to BeaumontBengal
To be fair, back door Roth is going to do the opposite of the thread title.
Posted on 6/26/18 at 10:14 pm to castorinho
Yes it is
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