How Coastline calculates the numbers
Coastline projects one year at a time, from your current age to the end of the plan. Each year it computes income, taxes, spending, contributions, withdrawals, and growth in that order, then carries the balances forward. Nothing is a rule of thumb applied to a lump sum — and in the app, clicking any row in the results table opens the full arithmetic for that year.
Taxes
Taxes are the reason most simple calculators are wrong, so they are modeled rather than approximated. On the US side, the engine computes:
- Federal ordinary income tax on inflation-indexed brackets, by filing status, with the standard deduction or real itemized deductions (charitable giving, mortgage interest, SALT) — whichever is larger, the same
max(itemized, standard)test the IRS applies. - FICA — Social Security at 6.2% up to the wage base, Medicare at 1.45%, plus the 0.9% additional Medicare surtax above the filing-status threshold — and self-employment tax (15.3% on 92.35% of net, half deductible) for business income.
- Long-term capital gains at 0/15/20%, correctly stacked on top of ordinary income rather than taxed in isolation — so a Roth conversion or a windfall can push gains into a higher capital-gains bracket, exactly as it does in reality. The 3.8% NIIT is applied to business-sale gains and to retirement brokerage gains above the MAGI threshold.
- State income tax for all 50 states plus DC — none, flat, or graduated, with the graduated schedules inflating over the projection. This includes the awkward cases: California’s 1% mental-health surcharge and Massachusetts’ 4% millionaire surtax are modeled as real top brackets.
- Social Security benefit taxation (up to 85% of the benefit becoming taxable), the Child Tax Credit with its phase-out, the QBI / §199A 20% pass-through deduction with its income phase-out, IRMAA Medicare premium surcharges, ACA premium subsidies, early-withdrawal penalties, RMDs, and the student-loan forgiveness “tax bomb”.
On the Canadian side the engine runs a separate implementation: federal and provincial brackets, the basic personal amount, CPP and EI contributions, the 50% capital-gains inclusion rate, RRSP deduction room, TFSA room, CPP and OAS with the OAS recovery tax (clawback), and RRSP-meltdown strategy modeling.
Accounts modeled
Taxable brokerage, 401(k)/403(b) (traditional and Roth) with employer match, governmental 457(b) as its own penalty-free-on-separation account, traditional and Roth IRA, HSA, cash savings, home equity with a real amortizing mortgage, pensions, annuities, rental property, business equity, and student, mortgage, auto and consumer debt. Withdrawals follow an explicit ordering — cash, then HSA, then 457(b), then brokerage, then penalized 401(k) — because which account you draw from changes the tax bill, and therefore how long the money lasts.
Projection, then simulation
The base projection is deterministic: a fixed return and inflation assumption, so the tax and cash-flow mechanics are visible and reproducible. That answers “what does this plan do if markets behave average?”
Because markets do not behave average, the same plan is then re-run hundreds or thousands of times under Monte Carlo and historical-sequence simulation, which returns the share of runs where the money lasts, plus the median, 10th- and 90th-percentile outcomes. This is what captures sequence-of-returns risk — the reason two retirements with identical average returns can end very differently depending on when the bad years land.
How these pages get their numbers
Every figure on every guide and tool page is produced by running that same engine at build time. Where a page reports a “safe” spend or a required nest egg, it was found by binary search — repeatedly re-running the full projection until it found the largest spend (or smallest portfolio) that survives the horizon. There are no hand-typed numbers and no figures borrowed from other calculators.
Documented simplifications
Every model simplifies. Naming the simplifications is the difference between a model and a black box, so here are the ones that matter:
- AMT is not modeled. It rarely binds for typical users under current law, but it can matter for large ISO exercises.
- QBI uses the conservative treatment above the income threshold, which can under-credit a non-service business with large W-2 wages. The error is in the cautious direction.
- State tax uses a single statewide schedule without state-level standard deductions, personal exemptions, or local/city income taxes. State treatment of retirement income varies and is approximated.
- Some areas are modeled approximately — ACA subsidy cliffs, business-sale taxation, and the interaction of certain credits among them.
- Returns are a model, not a forecast. Nobody knows future returns, inflation, or tax law. Results are estimates in today’s dollars under the assumptions shown, and they will not match reality exactly.
How the constants are kept current
Tax brackets, standard deductions, contribution limits, the Social Security wage base and PIA bend points, IRMAA tiers, and Medicare premiums all change annually. They live in one file in the codebase as a single source of truth, are reviewed each year against the primary source documents below, and are overridable in the app’s Constants Editor if you want to test a different assumption. Changes are checked by an automated verification suite before shipping.
Primary sources
Coastline’s parameters come from the publishers of the rules, not from secondary summaries:
- IRS Revenue Procedure 2025-32 — annual inflation-adjusted brackets, standard deduction, and thresholds
- IRS retirement plan contribution limits and required minimum distribution rules
- IRS substantially equal periodic payments (72(t)/SEPP)
- Social Security Administration — COLA, wage base and bend points and claim-age reduction and delayed-credit tables
- Medicare costs and CMS premium and IRMAA fact sheets
- Canada Revenue Agency — federal and provincial rates, RRSP/TFSA limits
- Government of Canada — CPP and OAS, including the OAS recovery tax
Coastline is an educational modeling tool built by a software engineer, not a licensed financial advisor — see about. Confirm any decision with a qualified professional.
Common questions
Does Coastline model real tax brackets or just an effective rate?
Real brackets. It computes federal ordinary income tax on inflation-indexed brackets by filing status, FICA, self-employment tax, long-term capital gains stacked on top of ordinary income, NIIT, state income tax for all 50 states and DC, Social Security benefit taxation, and credits including the Child Tax Credit and the QBI deduction. Canada is a separate implementation with federal and provincial brackets, CPP, EI, and the OAS clawback.
Does it account for sequence-of-returns risk?
Yes. The deterministic projection shows the mechanics, then the same plan is re-run hundreds or thousands of times under Monte Carlo and historical-sequence simulation, reporting the share of runs where the money lasts along with median, 10th- and 90th-percentile outcomes.
What is NOT modeled?
AMT is not modeled. QBI uses a conservative treatment above the income threshold. State tax uses a single statewide schedule without state standard deductions, exemptions, or local income taxes. ACA subsidy cliffs and business-sale taxation are approximate. Returns are an assumption, not a forecast.
How current are the tax numbers?
Brackets, deductions, contribution limits, the Social Security wage base and bend points, IRMAA tiers and Medicare premiums are reviewed and updated annually against IRS, SSA, CMS and CRA publications, and are covered by an automated verification suite. They can also be overridden in the app’s Constants Editor.
Where do the numbers on the guide pages come from?
They are computed at build time by the same engine the app runs — including binary searches that re-run the full projection to find the largest sustainable spend or the smallest sufficient portfolio. No figure is hand-typed or taken from another calculator.