Unfortunately I have to agree. My calculations say you are almost $12k short.This is not looking great I don’t think….
Total combined salary = $147k + $139k = $286k
Capital gains = $12k
Gross income before deductions = $298k.
Your deductions YTD = $35,793
Her deductions YTD = $19916
Total deductions YTD = $45,709
For December 15th paycheck, your deductions are $1,950 and her deductions are $1,750 = $3,700.
Gross income after deductions projected through December 15th = $298,000 - $45,709 - $3,700 = $241,591
Target AGI = $230,000
Shortfall = $11,591 that you must defer on December 25th paycheck but I think it may not be possible.
This overage is almost exactly equal to the capital gains realized earlier in the year. If only you hadn't done that, you would have definitely sneaked under.
Are there ANY taxable investments you can sell for a loss in the amount of $12k loss???
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That said, the way to salvage this situation now is to ask your Roth IRA providers to "recharacterize" your contributions to Roth IRA as Traditional IRA contributions instead. For both of you. Then once that is done, re convert to Roth IRA.
But this means you will have to pay ordinary income taxes on 28% growth of $14k, or on $3920 growth. Which means $941 extra taxes to Federal government at 24% rate, and $265 in extra state taxes. May be you can offset state taxes by contributing to NYSAVES 529 plan $4000 prior to December 31st.
Statistics: Posted by lakpr — Sat Dec 07, 2024 9:56 am