Its been discussed here lot but still not sure that while calculating pretax nominal return whether inflation should be taxable or not.
As far as I understand from doing AM mocks.
i: If portfolio returns are tax deferred = calculate Aftertax return, divide by (1-T) then add inflation
ii: If not tax deferred = calculate aftertax return, add inflation THEN divide by (1-T)
Is this correct? Are there any other indications when to use which method?