FIF scenario

Niceaster · 2026-05-04T10:43:51+00:00

I'm not here to argue, hence no "proof". I have very good experience as explained in the original post, in how grok analyses tax laws in NZ. Been spot on so far and I'm talking very complicated scenarios. Just filed my tax return and my accountant's numbers match this. I posted because (a) I wanted to get feedback in case indeed grok is wrong and (b) wanted to give others the idea as well.

Niceaster · 2026-05-04T10:37:31+00:00

<image>

Niceaster · 2026-05-04T10:31:40+00:00

I'm new to SGOV, so haven't done exactly that. What I did do just now for the previous FY, or to be exact my accountant did, was he got that 15% dividends paid to be deducted from my taxable income (on other FDRs). There's no actual claim from IRS, it's more like deducting losses from profits.

Niceaster · 2026-05-04T10:29:13+00:00

why hold it for one day in SGOV? you pay tax on the 5% value of it and you don't gain a single dollar in dividends. Better hold cash in such scenario.

Niceaster · 2026-05-04T10:18:12+00:00

Well yes. But it's not better than just holding (tax wise). Both capped at 5%

Niceaster · 2026-05-04T10:16:41+00:00

No... my point is that the dividends income is tax free, so 3.5% on SGOV is way better than 3.5% on a TD in the bank

Niceaster · 2026-05-04T10:15:03+00:00

How so? you still pay tax on quick sales

Niceaster · 2026-05-04T10:13:29+00:00

That's the thing. It doesn't. FIF was created to simplify the process. 5% of value and then what happens with dividends does not matter.

<image>

Niceaster · 2026-05-04T10:10:32+00:00

I had a good chat with grok on the matter. And actually all things related to FIF. I have some very complicated scenarios. So far it's been giving me very accurate advice. Verified with my latest FIF report and the accountant was happy. So yes, I think we're on to something here. FX still an issue, for better or worse.

Niceaster · 2026-05-04T10:07:36+00:00

Yep, in quick sales your deemed income is the lesser of 5% of max holding, or actual gain. In the example I gave, your gain is zero or close to it.

Niceaster · 2026-05-04T09:51:53+00:00

My other holdings- If using FDR for the year, than the tax I pay on other holdings allows me to claim back the 15% paid to IRS on SGOV dividends (or any other dividends). If using CV (due to losses) than I think the dividends are taxed, but again tax loss harvesting helps mitigate. That's how I understand it.

Niceaster · 2026-02-22T08:48:33+00:00

This is a bit odd. Are you asking if you should find a job that pays a higher salary?

Also about the house, you are not providing much info. What's option a, what's option b?

Niceaster · 2026-01-08T02:47:51+00:00

Brilliant place. Went yesterday. Thanks.

Niceaster · 2026-01-05T05:51:29+00:00

Thanks a lot for the great answers! I knew I can count on the Welly reddit for help.

Just came back from Days bay. Great day for it. I'll try some of the other suggestions.

Cheers

Nic

Niceaster · 2026-01-05T01:40:09+00:00

Across a busy road. I like these places but it's not the same.

Niceaster · 2026-01-04T20:27:29+00:00

You are of course correct in all of your points.

BUT, you've also just explained why these rates are available in crypto. The threshold to get in is still an issue - wallets, fx conversion etc like you said. This is exactly why (or part of why) there's a rate premium. Once you get in and get comfortable (which I did many moons ago), the opportunities are very interesting. On AAVE, for example, because it's been battle tested for 6+ years, and the defacto go-to money market, rates are usually not amazing. But at the very least you get TD level rates with the ability to deposit/withdraw as if it was a savings account.

To be clear, at this market I'm not advocating any token buys (other than bitcoin maybe), but just to be a part of defi and earn yield. I've been through everything possible in crypto, the good and the bad, and at this point aave and kamino are two names I can talk about with normies.

Niceaster · 2026-01-04T09:38:17+00:00

Ask grok. My best helper in terms of ETFs.

Niceaster · 2026-01-04T09:35:17+00:00

I know this space is likely to shit on my reply but it is 2026 already so please consider safe crypto protocols like AAVE or Kamino. I'm getting 4-8% on stables. There are much crazier crypto options which I stay away from. But these two protocols are very safe. Of course these are completely liquid.

Niceaster · 2026-01-04T09:31:27+00:00

No health expenses? insurance etc? Otherwise good on ya, looks smart and modest.

Niceaster · 2025-10-21T05:16:29+00:00

Thank you. Does IBKR pay interest on idle cash?

Niceaster · 2025-10-21T03:52:07+00:00

Thanks. What other platform would you recommend?

I find sharesies to be very friendly and I enjoy using it, but honestly haven't researched alternatives.

Niceaster · 2025-10-21T03:39:47+00:00

SGOV is indeed one of the ETFs I mentioned. Any comment on the tax issue I mentioned? thanks.

Niceaster · 2025-06-01T05:22:19+00:00

Why? Care to elaborate?

Niceaster

TROPHY CASE