Q & A
I invested in my former place of employment, a privately held company. They recently announced that they have filed for an IPO. Once the company goes public, am I taxed at a capital-gains rate or at my full income-tax rate? Also, as a former employee, can I withdraw the funds immediately, or is there a waiting period?
Answer: The Initial Public Offering does not trigger any taxation. Taxes only apply when you sell the shares. Any gains over your cost-basis are taxed as capital gains. If you sell shares you have owned for less than 12 months for…
I’m 67. I retired at 62 after 34 years and elected to begin taking my SS benefits. My wife is 65 and just retired after 21 years of work. She hasn’t taken her SS benefits yet. Is there a smart strategy (I hear about spousal strategies) to employ here, or did I eliminate strategic moves by having taken benefits at 62? I’ve tried to research this, but can’t seem to get a definitive answer. thanks for your consideration.
Answer: Your filing eliminated your ability to file a restricted application for only spousal benefits off your wife’s record. You are still eligible to suspend your benefits. If your benefit is larger than hers, this may be a good move because…
What is the Medicare Part D late enrollment penalty?
Answer: Medicare Part D is the prescription drug component to Medicare. If you enroll in a Part D plan after your 65th birthday, as you have been covered by group health insurance up to that time, you have a very good…
What are the best Medicare coverage options for retirees who travel a lot?
Answer: The best Medicare options for retirees who travel extensively depend on your destination. Let’s start with a quick review of the different coverage choices Medicare offers beneficiaries today. One option is Original Medicare, which has been around since 1966 and…
If I get Social Security disability benefits and I reach full retirement age, will I then receive retirement benefits?
Answer: Social Security disability benefits automatically change to retirement benefits when disability beneficiaries reach full retirement age. In most cases, the payment amount does not change. The law does not allow a person to receive both retirement and disability benefits simultaneously…
I’m an Air Force retiree whose wife uses Medicare/Tricare for Life. All has gone well so far, but now her doctor says he’s going to stop taking Medicare on assignment and has suggested my wife might want to look into a Medicare Advantage plan. Doctors who accept Medicare assignment are fairly scarce in our area. Since TFL always pays last, how would it work if she joined a Medicare supplement or Part C plan?
Answer: Should your wife choose to go with a Medicare Part C plan, she would not lose eligibility for Tricare for Life, but the way her health care is paid for would change a bit. If she signed up for a…
What are the rules for getting Social Security benefits outside of the United States?
Answer: I’ve been saving up some questions from readers who either live, or plan to live, outside the United States. Of course, all of their questions have to do with their eligibility for Social Security benefits. Before I go any further,…
I work part time as an employee and receive a W-2 for those wages, plus I have separate self-employment earnings that I pay taxes on each year. Only the W-2 wages appear on my most recent Social Security statement. Since I have been paying self-employment taxes, how do I fix this to include my self-employment?
Answer: Most people who pay into Social Security work for an employer. Their employer deducts Social Security taxes from their paycheck, matches that contribution, sends taxes to the IRS, and reports wages to Social Security. If registered for Social Security Administration’s…
If My Income Is $40,000 Per Year, Can I Still Receive A Retirement Benefit At 62?
Full Question: Can a person be working full time, making about $40,000 per year and still start receiving Social Security benefits at age 62? I know there will be a reduction in the monthly benefit from what it would be if…
Is There Any Hardship Allowance after Caring for an Ill Parent?
Full Question: I was an account manager in the building supplies industry, but was laid off in 2008. At the same time, my mother fell very ill with multiple sclerosis and required a lot of help. As her only son, and…