Finding a good tax shelter

August 19, 2011

My most recent column was about someone still working after having reached his “full retirement age.” Full retirement age, in Social Security speak, is that time in your life when you are eligible to collect your “full retirement benefit” without any offsets while maintaining a full-time job.
For those born between 1943 and 1954, the full retirement age is 66. So, although up to 85 percent of his Social Security benefit can be taxed, he avoided the tax by contributing his entire Social Security benefit into his company’s 401(k). The icing on the cake was the 3 percent match made by his employer that also went into the plan and was not taxable to him. Needless to say, he was a happy camper.
The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for the individual.