Determining Optimal Tax Deferral Strategies in the Absence of Capital Gains Tax Rates and Tax Deferral Credits
Journal of Applied Financial Research, Vol. III, pp. 2-10, 2009
Posted: 30 Aug 2009
Date Written: 2009
Several articles in the literature have examined optimal tax-deferral strategies. This paper extends this literature line by using a different combination of tax assumptions. Specifically, in this paper we assume all future income is taxed at the ordinary income tax rate. This tax assumption is relevant for individuals that invest primarily in investments that do not produce capital gains. Moreover, the tax assumptions here allow for a simpler analysis that is easier to understand than previous work.
Keywords: tax deferral, IRA
JEL Classification: H2
Suggested Citation: Suggested Citation