Saving for kids college .... instead of 529 you can start Roth IRA in their name

[mettastar]

Seems like they need to pay taxes on the early with drawls from the roth IRA

[phatposts]

1 minute ago, mettastar said:

Seems like they need to pay taxes on the early with drawls from the roth IRA

they need to file. 20y age daaka income takkuva untundi kabatti they would not be liable to "pay" taxes. file & pay are 2 very different terms. 

 

[Spartan]

5 minutes ago, phatposts said:

they need to file. 20y age daaka income takkuva untundi kabatti they would not be liable to "pay" taxes. file & pay are 2 very different terms. 

 

yes. filing is different from paying.

[Spartan]

9 minutes ago, kittaya said:

tax filing kooda matladaliii 

 

u can mail if not comfortable here.

[mettastar]

https://www.investopedia.com/529-plan-vs-roth-ira-for-college-4771260

[mettastar]

7 minutes ago, phatposts said:

they need to file. 20y age daaka income takkuva untundi kabatti they would not be liable to "pay" taxes. file & pay are 2 very different terms. 

 

Need to pay taxes on earnings .. not on contributions.. not sure if taxes need to be paid if they are below the taxable income bracket

[Spartan]

1 minute ago, mettastar said:

https://www.investopedia.com/529-plan-vs-roth-ira-for-college-4771260

adding it to main post.

[mettastar]

But roth ira seems like a better option .. if kids get full funding or something no need to worry about losing the money saved up

[Spartan]

Just now, mettastar said:

Need to pay taxes on earnings .. not on contributions.. not sure if taxes need to be paid if they are below the taxable income bracket

earnings grow tax free on IRA

[Spartan]

Just now, mettastar said:

But roth ira seems like a better option .. if kids get full funding or something no need to worry about losing the money saved up

thats the winning point..

vallu chadukom vere pani cheskuntam anukunna..they can use those funds unlike 529 which has to be used for education only

[mettastar]

44 minutes ago, Spartan said:

earnings grow tax free on IRA

Earnings grow tax free kaani .. college kosam withdraw chesthe its taxable but no penalty anta

Completely tax free and penalty free if you with draw after you turn 59½ yrs

[Spartan]

2 minutes ago, mettastar said:

Earnings grow tax free kaani .. college kosam withdraw chesthe its taxable but no penalty anta

Completely tax free and penalty free if you with draw after you turn 59½ yrs

paying one time tax is better than paying loan for 30 years with 10+% interest rate.

[vaakel_saab]

ROTH IRA account ki edhi best

[mettastar]

1 minute ago, mettastar said:

Earnings grow tax free kaani .. college kosam withdraw chesthe its taxable but no penalty anta

Completely tax free and penalty free if you with draw after you turn 59½ yrs

That means 100% of your withdrawals can go to college expenses. If you’re not 59½ yet, withdrawals of earnings will be subject to income taxes, but not an early withdrawal penalty, as long as the cash is used for college expenses.

 

Subject to income taxes annadu so if we withdraw less than taxable income bracket then no taxes probably

[Vaampire]

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