William Perry

Comments

• I have held primarily the Vanguard S & P funds in the past. The expense ratio for those mutual fund class is currently 0.04% and for the ETF class is 0.03% per Morningstar and both are listed as having a 2% turnover. I have owned both in my time as an investor and the difference as a buy and hold investor is nominal for me. My holdings have lately all been in traditional IRAs or Roth IRAs or 401(k) type plans and not in a taxable brokerage account. The reason many like the ETF class is the ability to lock the purchase and sales amounts at the time of trading and not the end of day that occurs with the mutual class. For me I prefer the mutual fund class end of day settlements as it helps keep me shooting myself in the foot by timing the market. The only compelling reasons that jumps into my mind for me to convert is if I was choosing for all my mutual fund class investments to leave Vanguard to another broker, I was planning to gift shares in kind to family whose brokerage firm is not Vanguard or for some investors if they were planning a in kind gift to a Donor Advised Fund (DAF) and the mutual fund class does not transfer in an efficient manner to the DAF.

  Post: Smart idea or not? Converting Vanguard mutual funds to Vanguard ETFs

  Link to comment from May 12, 2025

• Great point about possible headaches making required payments related to IRS form 1041 in 2025. Currently, there are direct pay options from a bank account for many individual and business taxes but I do not see form 1041 listed on the kinds of payments that direct pay accepts for either individuals or businesses. Unless direct pay is expanded to include 1041 payments or an exception to new payment requirements is carved out for paying 1041 taxes electronically, then you may be forced to make electronic deposits of tax on behalf of your trust by registering for and using the Electronic Federal Tax Payment System (EFTPS). Alternatively, if you use a paid preparer to electronically file your 1041 you may want to inquire if the tax software they use allows them to schedule electronic payments for the trust when they transmit the 1041 return.

  Post: EO 14249 Mandated Electronic Payments

  Link to comment from May 11, 2025

• Generosity Small acts of a single individual, joined by others, that can become life changing turning points for both those giving and those receiving. Thanks

  Post: Do It for the Kids

  Link to comment from May 9, 2025

• Hi RL, You have clearly been a great saver and as a buy and hold investor you are at a website where such virtuous habits are appreciated. My opinion of direct indexing as a financial tool is that the usefulness is often limited to a select group of individuals whose life and investment profile match the problem that direct indexing is trying to solve. I am not one of that select group. You noted many of the pros and cons of direct indexing but I think there are other considerations. Rob Berger did a 15 minute YouTube video on this topic a couple of years ago which may be worth a watch. Just google, if you are interested - Rob Berger Direct Indexing--Why the Tax Loss Harvesting Benefits Aren't Worth the Cost I suspect the main problems with direct indexing not noted by you above (cost and complexity when you stop using direct indexing) but noted in Mr. Berger's video that you may want to consider are - Will your benefit from tax loss harvesting (TLH) from direct indexing decrease quickly over time as losses in the direct index are realized and you are left with mostly investments with unrealized taxable gains which typically occurs after about five years? As a long term buy and hold investor to fund the direct indexing account will you have to realize large taxable gains from selling mutual funds? Will you have sufficient other capital gains to utilize the capital losses generated from TLH? I will leave other questions and possible recommendations to other Humble Dollar commenters. I hope this helps. Best, Bill

  Post: Tax Efficient Investing for Retirees with High Net Worth: Direct Indexing?

  Link to comment from May 8, 2025

• You could have just bought the car, shipped it to the US and then have the perfect car for a job delivering rural mail to pay for your vacation if you had been unsuccessful in your claim. Ha! Happy to hear everyone is ok. Note to self, buy the rental insurance and request an increase of my credit card limit.

  Post: A Tale of Excess

  Link to comment from May 8, 2025

• I am on page 157 of 324 and enjoying the read.

  Post: Wall Street Journal Article about Jonathan’s New Initiative

  Link to comment from May 8, 2025

• The payment to the government is not currently a hard date but rather "as soon as practicable" as I understand the current law.

  Post: EO 14249 Mandated Electronic Payments

  Link to comment from May 8, 2025

• I saw that CBDC comment too. I know congress passed and the President signed a new law in March 2025 that blocks DeFi required reporting by the decentralized crypto exchanges. My understanding is tax law still currently requires brokerage, but not DeFi, reporting of digital asset sales to begin in tax year 2025 with a new form 1099-DA to be sent out in early 2026 but the brokerage reporting of tax basis and character of the gain/loss to begin in tax year 2026 and that information will go out in early 2027. What a mess. I would prefer for all entities to fully report or no entities to report. Regardless of whether a third party has an obligation to report to you, and the government, the burden of reporting crypto transactions is still on the taxpayer to report those taxable events on their own 1040. Making it harder to receive complete tax information in a organized manner increases the time and cost of tax compliance burden on all taxpayers with crypto investments. When the page one question on your 1040 regarding digital assets is answered yes both tax taxpayer and their preparer should expect extra work to comply with the reporting obligations. I admit my thinking about cryptocurrency has been negatively influenced by the late Charlie Munger's comments.

  Post: EO 14249 Mandated Electronic Payments

  Link to comment from May 8, 2025

• Often 1040 tax clients who still pay by check will provide preparers with copies / pdf's of the check before they mail the payment when they provide the preparer their information. I had one client who on the written dollar amount line that instead of "...& no hundreds" would instead write "and not a D** penny more". The check was still deposited by the IRS. I would guess your "extra processing" might mean you were getting a substantial refund because something on your return was large compared with the average for the item such as a huge medical expense deduction. If so your refund may include a small amount of interest which is taxable income in the year paid to you and the IRS, like anyone else, only issues you a 1099-Int if the amount is $10 or more. Still taxable 1099 or not.

  Post: EO 14249 Mandated Electronic Payments

  Link to comment from May 8, 2025

• Agree, but sort of similar to disliking investment losses more than liking investment gains, it usually only takes the one bad experience where a mailed ES payment or balance due payment is lost or deemed paid late for a taxpayer to be motivated to change to from paper to electronic payments.

  Post: EO 14249 Mandated Electronic Payments

  Link to comment from May 8, 2025