The Help Desk

Do I need to sell my mutual fund to capture its gain?

My U.S. stock mutual fund has risen in value by 20% this year. I want to be sure to capture that 20% gain. Will the mutual fund's year-end capital gains distribution capture that 20% gain, or do I have to sell the mutual fund shares to do so? — Paul K.

You have to sell your fund shares to capture that gain. Your fund realizes its own capital gains and losses MORE

Can I deduct interest on a 401(k) loan to my business?

Let's say I make a loan to my (or my wife's) business by borrowing from my 401(k) and using the money for business expenses. Is the interest the business pays back to my 401(k) plan tax deductible? — Michael R.

The short answer is no, according to Myrna Mitnick, a senior tax manager at Baltimore, Md.-based CPA firm Leonard J. Miller & Associates. The IRS typically does allow businesses to deduct MORE

How can you avoid big fees for wealth management?

I am a 56-year-old retired widower. I live off my monthly pension with built-in COLAs, but I also work full-time. My net worth is substantial, and the wealth managers I've interviewed have all provided different advice with big fees attached. I just want our investment to grow with as little risk as possible, without paying large fees. Can you give me advice or direction? – Name withheld

Given how careful you've MORE

Should I buy additional credit for my pension?

Should I purchase additional service credit to increase the final compensation for my pension plan? I'm currently 42 and plan to retire at 62. At that age, I will receive 81.5% of my $10,000-a-month income. I was told I could increase my final compensation by about 10% at the cost of $82,000 (which I plan to transfer from my 457 plan). Is this a good idea? – Name withheld

Given your MORE

Can I make both pre- and post-tax contributions to a 401(k)?

Can I invest both pre- and post-tax dollars in the same 401(k)? If so, how do I know what taxes I owe at withdrawal? — Kathy B.

Whether or not you can invest both pre-tax and after-tax dollars in the same 401(k) depends on the plan itself. It's a safe bet that your employer's 401(k) plan permits pre-tax contributions, according to Kaye Thomas, who spent two decades as a tax lawyer MORE

Should I convert my daughter's UTMA to a 529 plan?

After reading about Uniform Transfer to Minors Act (UTMA) accounts, I regret opening one for my 13-year-old daughter. As I understand it, her mutual fund UTMA will reduce her financial aid by a greater amount than if the money was in my name or in a 529 plan. My daughter has about $3,000 in the account. How can I transfer it into a 529 plan without being penalized on taxes? MORE

How do I buy an ETF cheaply?

How would I purchase an ETF? What is the cheapest way to buy an ETF? – Name withheld

Exchange traded funds (ETFs) are widely available from a variety of brokerage firms, says Roger Woodman, founder of Roger F. Woodman Jr. & Co., a financial advisory firm in Portland, Maine. Just open an account at a major online broker such as Fidelity, Vanguard, Charles Schwab, E*Trade, or TD Ameritrade, and you can MORE

When should I apply for Medicare?

I'm planning on retiring when I turn 65, which is in five months. Do I wait until I'm 65 to apply for Medicare? – Sharon V.

If you're already receiving Social Security benefits, you'll be automatically enrolled in Medicare Parts A and B when you turn 65, says James Long, a licensed health insurance agent at Young's Insurance Services in Eagleville, Penn.

If you're not receiving Social Security benefits, however, consider signing MORE

How do you straighten out a credit file mix-up?

My mother and her ex-daughter-in-law shared the same first and last name. My ex-sister-in-law has ruined her credit ratings, and now my mother is having issues with her checks, charge cards, etc., due to sharing the same name. Creditors are not bothering to look at Social Security numbers. Is there any way to repair my mother's credit? – Scott

Untangling your mother's credit information may be a headache. Mixed credit files, MORE

Will I be taxed on my mom's life insurance policy?

My mom just passed away, and I'm the beneficiary of her $25,000 life insurance policy. Am I taxed on this? I plan to disperse the money to others in my family. Can I pay tax on it off the top so others don't have to pay tax on the money? –Jerry

In general, the face value of a life insurance policy is not subject to federal income tax, says Susan Growney, MORE