How are taxes treated in FIRECalc

blavorini · May 17, 2024

Hi, this might be a dumb question, but I don't understand how taxes are accounted for in the FIRECalc engine. No mention of money in Roth vs traditional IRA, qualified/nonqualified sources of funds, effective Federal Tax rate, state/city taxes. All these have to play a role, right?

CardsFan · May 17, 2024

Taxes are part of your spending. You need to estimate taxes and add it to your estimated spend.

REWahoo · May 17, 2024

CardsFan said:
Taxes are part of your spending. You need to estimate taxes and add it to your estimated spend.

Correct.

Here's a good thread on the subject in the FIRECalc Support forum: What about Taxes in FireCalc?

Koolau · May 17, 2024

Yeah, taxes are just part of your expenses, but with enough effort and a good plan you can somewhat control taxes (within limits.) More by good fortune than good a good plan :blush:

our state taxes are very low even though our state income tax is one of the highest in the nation. YMMV

pb4uski · May 17, 2024

IRS & State Tax Calculator | 2005 -- 2024 is a good tool to sketch our your tax cost to then include in FIRECalc. A common error is to use your tax bracket while working when in reality it is usually a lot lower for early retirees. It would be nil for me except I do low tax cost Roth conversions but even then it was only ~11% in 2023.

How are taxes treated in FIRECalc

blavorini

Confused about dryer sheets

CardsFan

Thinks s/he gets paid by the post

REWahoo

Give me a museum and I'll fill it. (Picasso) Give

Koolau

Give me a museum and I'll fill it. (Picasso) Give me a forum ...

pb4uski

Give me a museum and I'll fill it. (Picasso) Give me a forum ...

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