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Learning, Sharing, and Teaching => Ask a Mustachian => Topic started by: pdxvandal on May 18, 2015, 10:48:43 PM

Title: Sell taxable to invest in company pre-tax account?
Post by: pdxvandal on May 18, 2015, 10:48:43 PM
Hi folks.

I'm starting a new job soon with a deferred compensation (457) plan. I'd like to max it out for this year (18k), which would likely leave me with about $1,000 in my emergency fund by December. I have about 50k in taxable accounts. To gain the tax advantages, would it make any sense to sell a few thousand bucks in taxable funds and re-invest it into the 457 instead of depleting nearly all the cash emergency fund? In doing so, I'd also come pretty close to the 15% federal tax bracket.

Has anyone considered or done this for their pre-tax retirement savings?

Thanks.
Title: Re: Sell taxable to invest in company pre-tax account?
Post by: Psychstache on May 18, 2015, 11:12:05 PM
I am doing this. I cash out taxable over time while I max out my 403b and 457.
Title: Re: Sell taxable to invest in company pre-tax account?
Post by: MDM on May 18, 2015, 11:17:37 PM
To gain the tax advantages, would it make any sense to sell a few thousand bucks in taxable funds and re-invest it into the 457 instead of depleting nearly all the cash emergency fund? In doing so, I'd also come pretty close to the 15% federal tax bracket.
If you expect your income to increase, and you can take some LTCGs now while paying 0% tax, why not?  That is a good idea on its own merits. 

If this allows you to contribute more to the 457, all the better!
Title: Re: Sell taxable to invest in company pre-tax account?
Post by: forummm on May 19, 2015, 09:54:44 AM
I would totally do that.