Sell the year after — stock held 5 years (founder exit)
Sell the year after — stock held 5 years ends $41.52M ahead of keep building, no sale after tax, but pays $1.66M more tax over a lifetime. The two measures disagree.
- Which of those matters depends on what you are optimising for — ending wealth, or tax paid along the way.
- 6 years more paying IRMAA surcharges.
- All of it under the assumptions listed below, which the reader can change.
What the tax change is made of
- Tax on dividends, interest and portfolio gains: +$1.69M
- Federal income tax: −$63,689
- IRMAA surcharges on Medicare premiums: +$33,519
These add back to the total change; they are the same taxes the projection sums into the headline, discounted the same way.
Not financial or tax advice.
Lifetime tax (present value)$2,092,796
Terminal after-tax wealth$41,730,612
Years in IRMAA6
What this assumes
Every figure below depends on these. Change one and the answer changes.
- Horizon
- 30 yearsHow many years the projection runs.
- Nominal return
- 5%Assumed annual growth before inflation.
- Inflation
- 2.5%Grows spending, and indexes brackets between published years.
- Discount rate
- 3%Used to present-value lifetime tax — the headline metric.
- Future tax law
- Current law continuesLeft on current law, the projection assumes today’s brackets last the whole horizon — itself a forecast, not a neutral choice.
Other assumptions (4)
- Dividend yield
- 1.2%
- Interest yield
- 0.8%
- Business cash return
- 2%
- Income growth
- 0%
Year by year
| Year | Age | Ordinary income | Federal tax | IRMAA | Net worth |
|---|---|---|---|---|---|
| 0 | 41 | $180,000 | $21,940 | $0 | $553,651 |
| 1 | 42 | $180,000 | $21,499 | $0 | $596,179 |
| 2 | 43 | $180,000 | $21,046 | $0 | $13,186,717 |
| 3 | 44 | $180,000 | $20,582 | $0 | $13,800,619 |
| 4 | 45 | $180,000 | $20,107 | $0 | $14,438,852 |
| 5 | 46 | $180,000 | $19,619 | $0 | $15,102,388 |
| 6 | 47 | $180,000 | $19,120 | $0 | $15,792,239 |
| 7 | 48 | $180,000 | $18,608 | $0 | $16,509,463 |
| 8 | 49 | $180,000 | $18,083 | $0 | $17,255,164 |
| 9 | 50 | $180,000 | $17,545 | $0 | $18,030,495 |
| 10 | 51 | $180,000 | $16,994 | $0 | $18,836,657 |
| 11 | 52 | $180,000 | $16,429 | $0 | $19,674,907 |
| 12 | 53 | $180,000 | $15,849 | $0 | $20,546,553 |
| 13 | 54 | $180,000 | $15,590 | $0 | $21,452,964 |
| 14 | 55 | $180,000 | $15,439 | $0 | $22,395,565 |
| 15 | 56 | $180,000 | $15,285 | $0 | $23,375,847 |
| 16 | 57 | $180,000 | $15,128 | $0 | $24,395,337 |
| 17 | 58 | $180,000 | $14,966 | $0 | $25,455,654 |
| 18 | 59 | $180,000 | $14,800 | $0 | $26,558,491 |
| 19 | 60 | $180,000 | $14,630 | $0 | $27,705,616 |
| 20 | 61 | $180,000 | $14,456 | $0 | $28,898,873 |
| 21 | 62 | $180,000 | $14,277 | $0 | $30,140,187 |
| 22 | 63 | $180,000 | $14,094 | $0 | $31,431,566 |
| 23 | 64 | $180,000 | $13,906 | $0 | $32,775,109 |
| 24 | 65 | $180,000 | $13,714 | $11,495 | $34,160,022 |
| 25 | 66 | $180,000 | $13,517 | $11,782 | $35,600,634 |
| 26 | 67 | $180,000 | $13,315 | $12,077 | $37,099,280 |
| 27 | 68 | $180,000 | $13,108 | $12,379 | $38,658,397 |
| 28 | 69 | $180,000 | $12,895 | $12,688 | $40,280,525 |
| 29 | 70 | $180,000 | $12,678 | $13,005 | $41,968,319 |