Hi all,
I need to simulate a few relocations, while finding optimal Roth Conversions and Stock Sell (LTCG) based on new State Tax rate.
Can a few such relocations be defined to see resulting Plan scenario changes for all Expenses?
Yes, each Relocation comes with different Real Estate Buy / Sell or Rent details.
Thanks
I don't fully understand what you are trying to do. For each personal residence, you can set the cost basis, taxes, mortgage, expenses, upgrades, appreciation. You can tell it what year to buy and sell. It figures you personal residence exemption from capital gains and taxes you on the rest. I set up a test with 11 different residences before deciding that the limit was quite high.
For rental properities, it tracks similar things plus allows improvements, depreciation, QBI eligibility and more.
It allows two relocations to different states applies their taxes, though I suspect that in the years you move there will be complexities that Pralana can't handle where you are paying part-year taxes in both states.
Pralana's Roth Conversion module takes all that information as a given and tests the ordinary income tax rates in each year. You can sometimes beat the Optimizer a little by backing off a partially filled IRMAA tier or whatnot.
If that's not satisfactory, I think you are out of luck; I see about zero chance that there's a more capable tool out there for handling these kinds of things.
I'd like to see how much on taxes I can save to move from CA to another State like a FL, NV, while time Roth Conversions, Stock Sell / rebase.
To see how long it will be more optimal? 2 years? 5 years? etc?
To do Roth Conversion in an year or over 5+ years? Also with NIIT hit or to do Stock rebase in different year than Roth Conversion and how much is and what are trade off?
So far I'm thinking about primary residence sell then rent then rent then buy, so I'd like to have 4-5 changes for primary residence.
How it works for moving offshore? Mexico, Spain, etc?
thank you.
Pralana does not handle international taxes. The US has worldwide taxation, meaning you can't move elsewhere and escape US taxes. Even if you try to do it by renouncing your citizenship, the US may take 40% of everything under the theory that you are leaving to avoid taxes.
As I said, Pralana can handle three residences during your lifetime, so you could model moving from high tax to low tax and back.
Not sure why you would need to move 4-5 times to get to a lower tax state. If you don't like it where you're at, just leave. If you have an otherwise great time where you live, not sure why you would go through the pain of moving and living somewhere you don't want to be just to avoid some taxes.
The state you are leaving will want to continue to tax you, there are horror stories out there of people being audited for a decade or more by the state they left where they had to prove they really had cut all ties to the old state and established a life in the new state - things like purchasing a home in the new location, getting new doctors, dentist, bank, pharmacy, voter registration, driver's license, car tags, etc. (The more money you have, the harder they chase). Anything that seems to the state revenue department like you are doing trying dodge taxes without fully relocating your life to the low tax state - things like keeping a house in the high tax state- may earn you a tax dispute with the high tax state.
