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Sell Stocks Or Cash In IRA: Compare Results
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To use this calculator, click on the FILE tab and MAKE A COPY of it. Put your variables in the yellow boxes of the COPY. (You can't alter or input numbers in the original file.) Most retirees are better off selling taxable assets to cover living expenses, but you might do better dipping into the IRA instead if your taxable assets are highly appreciated and you think there's a good chance you can avoid capital gain taxes on those assets, for example by leaving them to heirs.
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Federal tax rate on ordinary income24%
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Federal investment income surcharge (either 0 or 3.8)
0%Advantage to selling taxable assets and holding the IRA
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Federal tax rate on capital gains and dividends15%$7,326
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State tax rate6%
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Portfolio annual total return you expect5%
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Holding period until later cash-out12years
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Cost of taxable asset, as percent of current value80%
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Probability of bypassing capital gain tax50%
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Aftertax withdrawal$100,000
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Yield on portfolio1.3%
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Price appreciation in portfolio3.65%
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Aftertax value of a dollar from IRA distribution 0.70
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Aftertax value of a dollar of capital gain0.79
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IRA distribution needed to raise $100,000$142,857
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Sale of appreciated securities to raise $100,000$104,384
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