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<blockquote data-quote="satellitedriver" data-source="post: 254359" data-attributes="member: 1664"><p>Something I am going to investigate is the long term tax implications of over investing in your 401k.</p><p>When you withdraw money from your 401k it will be taxed at the earned income rate, I am cool with that since, the pre-tax dollars accumulated alot of growth through the years.</p><p>The sticky point is will this withdrawal from your 401k count as "earned income" apply to the restrictions when you receive Social Security?</p><p>There are set amounts you can earn(by working) before a deduction of SS benefits kick in.</p><p>Basically, your SS will be lessened by $1.00 for every $2.00 you earn over the set limit.</p><p>A 50% tax rate on a tax you already paid, but that is a different thread topic.</p><p>Back to my point, it maybe to ones advantage to take the tax hit now and invest in investments than will only be taxed as capital gains in the future.</p><p>I will look into this.</p><p>If any one can shed some light on this subject, please post.</p><p>PAX</p></blockquote><p></p>
[QUOTE="satellitedriver, post: 254359, member: 1664"] Something I am going to investigate is the long term tax implications of over investing in your 401k. When you withdraw money from your 401k it will be taxed at the earned income rate, I am cool with that since, the pre-tax dollars accumulated alot of growth through the years. The sticky point is will this withdrawal from your 401k count as "earned income" apply to the restrictions when you receive Social Security? There are set amounts you can earn(by working) before a deduction of SS benefits kick in. Basically, your SS will be lessened by $1.00 for every $2.00 you earn over the set limit. A 50% tax rate on a tax you already paid, but that is a different thread topic. Back to my point, it maybe to ones advantage to take the tax hit now and invest in investments than will only be taxed as capital gains in the future. I will look into this. If any one can shed some light on this subject, please post. PAX [/QUOTE]
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