1 full month. If you leave early or join late, the fund makes a prorated distribution.

It’s not quite the same regulatory framework as ordinary mutual funds, to allow money market funds to keep the price constant they don’t use the normal ex dividend trading schedule.

Cash is paying more than 3.9% right now, there’s no reason at all to consider paying that loan down.

> the more you use your credit card and pay it back on time, the higher your score gets

No.

Paying on time is good for your score. Paying a bill of $0 is exactly as “on time” as paying a bill of $10,000, and has exactly the same effect.

Actually using the card is, at best, irrelevant, and at worst (temporarily) bad if your utilization becomes particularly high. Though utilization is not remembered month to month, so it’s not something that needs to be managed unless you are actively trying to get a loan.

So long as the card isn’t so inactive that the issuer closes the account, using it or not doesn’t matter.

> 401k accounts are FDIC insured up to $250k

No they aren’t. Possibly your specific 401k could have a cash fund at an FDIC insured bank, but that still wouldn’t be the 401k that is insured, it would be the bank.

SIPC insures brokers up to $500k, which would generally cover most 401k administrators.

You should note, however, that 401k assets do not belong to the administrator anyway, broker insolvency does not effect your 401k in any significant way. SIPC coverage only really comes in if the broker is pulling a Madoff, and stealing the money while pretending to invest it.

> They sound comparable with target funds being a safer option

“Easier”

Nobody said anything about safer.

> I’m confused because the Vanguard Target Funds have way less than your age in bonds.

Age in bonds is also the “easier” explanation, it’s something that someone without any knowledge of modern portfolio theory can probably manage to do. That doesn’t mean it is actually what modern portfolio theory says to do… just close enough that you’ll manage ok. It was the general recommendation before target date funds allowed everyone to easily access actual modern portfolio theory allocations.

You can still do whatever you want, of course, but if you don’t want to follow MPT precisely then target date funds are not for you.

The underwitholding penalty is currently 7%, it varies semi-annually based on the federal short term rate.

If you routinely underpay, you will be subjected to backup withholding and the IRS will require your employer/bank/brokerage/etc. to withhold from all income irrespective of your instructions.

Because you paid the correct amount of taxes instead of overpaying.

A refund is not the government saying “hey, thanks for paying your taxes, have some free money.”

A refund is the government saying “your total is $15.69, you paid with a $20, your change is $4.31.”

In that case, your sale just results in capital losses now, unrelated to your previous taxes. If you end the year with a net capital loss, up to $3k of that reduces your other taxable income, and the rest carries forward to future years.

Your previous taxes occurred in the past, and are no longer important to anything that goes on now.

ISOs do not work like that, either you are talking about something else (like an NSO) or you and your employer messed up badly.

> I paid significant State and Federal (USA) Supplemental Income Tax based on the Fair Market Value (FMV) at the time.

Are you talking about alternative minimum tax?

Because otherwise, there are no taxes on exercising of ISOs, only on sale is tax applied.

Assuming you are talking about alternative minimum tax, you gain a credit for the excess taxes paid in every year you are not subject to AMT.

Since it’s now been 2 years since exercise, you are free to sell whenever, and you’ll eventually recoup the AMT (unless you are always subject to AMT, in which case you are still free to sell whenever and the AMT tax rates are just what you pay).

Those are by far the least important parts of your startup, and certainly not something you need to put money or effort into until you have the actually important stuff squared away. Partner is 100% correct, at least as far as priorities go.

The bank does have to return the money.

The scammer is not the one returning the money though, the bank is. The scammer has already deposited the check in a stolen or fraudulent bank account (and/or at a check cashing location like many Walmarts), withdrawn the cash, and vanished into the ether.

This isn’t new, it’s as old as banks.

Closer to 5 years earlier at current interest rates, give or take.

There are 12 months in a year. But there are 52 weeks in a year. So if you pay every two weeks, you make 26 payments, which is the equivalent of 13 months worth of mortgage payments every year. That’s why you pay off early.

China has significant restrictions surrounding capital leaving the country, you’re going to have to comply with those if you want to withdraw that cash.

Just read the instructions for the W4.

If you put married filing jointly, your employer withholds as if you have $25k standard deduction, $20k at 10%, $60k at 12%, etc. Which is correct, those are the tax brackets for married filing jointly.

But if you have multiple jobs (eg both you and your wife work), then combined between your jobs your withholding looks like you have $50k of standard deduction, $40k at 10%, etc. So you massively underwithhold.

The solution is to follow the instructions in step 2 for multiple jobs. (Or alternatively, you could both select single instead of married filing jointly).

Are you saying you only put married filing jointly, and did not fill out the multiple job worksheet in step 2?

Then that’s your problem. You guys have 2 jobs and failed to inform your employers to withhold as such.

At $143k of income with two kids you’d expect to owe about $$13k in taxes. You paid about $10k in taxes. It all looks correct.

How did you and wife fill out your w4?

Just write $6500 on line 4b of your W4. You now have not withheld taxes on your $6500 IRA contribution.

An IRA has nothing to do with your employer, or your payroll.

You are confused how taxes work: your paycheck withholding is not your tax, it is an estimate based ont the information you give your employer (remember form w4?, that was you telling them how much tax you think you owe). If that was incorrect, it is corrected at the end of the year (that’s your tax return, where you are refunded extra tax paid, or pay more if you didn’t pay enough). If you make an IRA contribution, you write it on your tax return to claim it as pre tax.

If you want your employer not to withhold tax on your IRA contribution, you can put that on you w4. Otherwise, you will get back any overpayment at the end of the year. In either case, it is “pre tax.” It’s just a question of when you notice the extra money.

The answer, formally, is that the IRS has not yet issued any ruling on that problem, and so nobody actually knows whether that could become a problem.

The practical answer is that it is so easy to find alternatives that still have essentially perfect correlation, that it is not really worth taking a risk on it.

It’s not a bad idea, as such. It’s a fairly common method, the sub is r/churning.

Here their post on the risks.

https://reddit.com/r/churning/comments/8m487c/why_you_should_not_begin_churning_v30/

You tell them you want to buy something. They find it and buy it for you. Just like buying anything else through a brokerage.

The vast majority of bonds you’ll find available are on the secondary markets, because that’s where the vast majority of bonds are.

If they offer the option, you may also be able to place bids at an auction through them.

I’ve never specifically used Merrill, so I can’t speak for them specifically how they display those options (as far as whatever yield you believe you are seeing). You may simply be mistaking which bond you are looking at. They may provide an estimated yield based on current market trends, as a guide, with no guarantee that’s what you’ll get. They may be offering to make a competitive bid at that price or better, with no guarantee you’ll win the auction. Or something else. Either read the description, or call and ask.

> are we better off sticking with a consistent savings+interest

Nothing about your savings account is consistent, just last year you would have struggled to find anything above 0.5%. Your future savings account rate is just as temporary and unknown.

> I was planning on leaving them for the full 30 years, but it seems like people who understand this stuff far better than I do choose to take them out at 5 years?

Generally speaking, inflation has not been very high in the US. The last period of high inflation was the 1970s. The last decade of historically low interest rates has been driven by the federal reserve struggling to get inflation to reach 2%, and failing.

The general expectation is that there will not be long term high inflation in the US, basically nobody expects there to be. In that kind of environment, holding I bonds for the long term would be a poor choice, and so nobody is really planning on doing so.

Luckily, you can choose to redeem whenever you want (at least, after 1 year), so at any time between now and 30 years you can adjust your strategy.

You report the income on your US taxes exactly like income you earned in the US, US citizens are taxed on worldwide income by the US.

If you paid taxes to Germany, you can claim a tax credit for those taxes using form 1116.

https://www.irs.gov/individuals/international-taxpayers/foreign-tax-credit

The “spirt of the law” is that you can take advantage of specific benefits in exchange for specific restrictions. Taking advantage of the benefits without any of the accompanying restrictions is the opposite of the spirit.

Stock traders don’t generally move money back and forth between checking and brokerage, he’s nothing special.