It’s January, so it was time to run my sweet spot income calculations for 2024. While I was at it, I decided to compare this year’s sweet spot to my 2021 numbers to see how the high inflation over the past 3 years effected my numbers.
Just as a reminder, my definition of a sweet spot is the maximum taxable income I can have before crossing over from the 12% federal tax bracket into the 22% bracket.
The COLA increases for 2022, 2023, and 2024 were 5.9%, 8.7% and 3.2%. The sum would be 17.8%, while the compound increase is 18.8%. When my SSB increased by 18.8%, most of my other sweet spot numbers increased by about 14% to 16%. The only number that was way out of line was the amount of taxable Social Security which increased by 28% because the $25,000 starting point for taxable SSB never increases!
The percentage of my Social Security give back increased from 7.04% to 8.22%. The IRS is now giving over $3,100 of my benefits back into the Trust Fund, and if I violate my sweet spot calculations and allow the full 85% taxation of my benefits at 22%, they will take back almost $8,000!
I can live in my sweet spot because a little over 70% of my IRA savings are in Roth.
Just as a reminder, my definition of a sweet spot is the maximum taxable income I can have before crossing over from the 12% federal tax bracket into the 22% bracket.
The COLA increases for 2022, 2023, and 2024 were 5.9%, 8.7% and 3.2%. The sum would be 17.8%, while the compound increase is 18.8%. When my SSB increased by 18.8%, most of my other sweet spot numbers increased by about 14% to 16%. The only number that was way out of line was the amount of taxable Social Security which increased by 28% because the $25,000 starting point for taxable SSB never increases!
The percentage of my Social Security give back increased from 7.04% to 8.22%. The IRS is now giving over $3,100 of my benefits back into the Trust Fund, and if I violate my sweet spot calculations and allow the full 85% taxation of my benefits at 22%, they will take back almost $8,000!
I can live in my sweet spot because a little over 70% of my IRA savings are in Roth.
Statistics: Posted by PapaGeek — Mon Jan 08, 2024 3:35 am — Replies 0 — Views 120