Dear Liz: If someone inherits my retirement account, is there any way they can avoid having their Medicare premiums increased for one year? Answer: A large-enough retirement account could affect their Medicare premiums for up to 10 years, not just one. Normally inheritances aren’t taxable, but retirement accounts are the exception. Withdrawals from inherited retirement […]
Recent Blog Posts
Q&A: Simplify your finances with fewer credit cards
Dear Liz: I have too many credit cards that I opened to get frequent flier points. I understand that closing a credit card lowers your credit scores. How long does the ding last? How long should I wait before closing another card? Do you have any other advice on this subject? You probably have discussed […]
Q&A: Don’t need your RMD? Consider a QCD
Dear Liz: When you’re writing about required minimum distributions from retirement accounts, please make sure people know about qualified charitable distributions. Those of us lucky enough not to need the money can donate it directly from an IRA to the nonprofits of our choice. That way, we don’t even have it in our income column, […]
Q&A: Timing a Social Security application
Dear Liz: I know you work to maximize people’s money. I had a thought about the quality of life with Social Security. I took it at 65, which was then full retirement age. I was fully employed and did not need it to live. However, the extra money allowed us the opportunity to travel to […]
Q&A: Sharing an inherited house with your siblings? It can get complicated
Dear Liz: My husband’s parents, who are 88 and 93, respectively, have decided to leave their house, worth $800,000, equally, to their three children, who are all in their sixties. The children get along well and all decisions will be made as a group. None of the adult children can afford to buy out the […]
Q&A: Selling a house? Don’t confuse the tax rules
Dear Liz: We read your recent column about capital gains and home sales. Our understanding is that if you sell and then buy a property of equal or greater value within the 180-day window, the basis for tax purposes is the purchase price, plus the $500,000 exemption, plus the improvements to the property, minus the […]