Weekly Tax Brief
- Published: 05 October 2016 05 October 2016
There’s a lot to think about when you change jobs, and it’s easy for a 401(k) or other employer-sponsored retirement plan to get lost in the shuffle. But to keep building tax-deferred savings, it’s important to make an informed decision about your old plan. First and foremost, don’t take a lump-sum distribution from your old employer’s retirement plan. It generally will be taxable and, if you’re under age 59½, subject to a 10% early-withdrawal penalty. Here are three tax-smart alternatives:
- Published: 28 September 2016 28 September 2016
If you’re charitably inclined, making donations is probably one of your key year-end tax planning strategies. But if you typically give cash, you may want to consider another option that provides not just one but two tax benefits: Donating long-term appreciated stock.
- Published: 21 September 2016 21 September 2016
Section 529 plans provide a tax-advantaged way to help pay for college expenses. Here are just a few of the benefits:
- Although contributions aren’t deductible for federal purposes, plan assets can grow tax-deferred.
- Some states offer tax incentives for contributing in the form of deductions or credits.
- The plans usually offer high contribution limits, and there are no income limits for contributing.
- Published: 15 September 2016 15 September 2016
If you have incomplete or missing records and get audited by the IRS, your business will likely lose out on valuable deductions. Here are two recent U.S. Tax Court cases that help illustrate the rules for documenting deductions.
- Published: 07 September 2016 07 September 2016
If you invest, whether you’re considered an investor or a trader can have a significant impact on your tax bill. Do you know the difference?
- Published: 30 August 2016 30 August 2016
If you recently redeemed frequent flyer miles to treat the family to a fun summer vacation or to take your spouse on a romantic getaway, you might assume that there are no tax implications involved. And you’re probably right — but there is a chance your miles could be taxable.
- Published: 15 August 2016 15 August 2016
Giving away assets during your life will help reduce the size of your taxable estate, which is beneficial if you have a large estate that could be subject to estate taxes. For 2016, the lifetime gift and estate tax exemption is $5.45 million (twice that for married couples with proper estate planning strategies in place).
- Published: 04 August 2016 04 August 2016
For anyone who takes a spin at roulette, cries out “Bingo!” or engages in other wagering activities, it’s important to be familiar with the applicable tax rules. Otherwise, you could be putting yourself at risk for interest or penalties — or missing out on tax-saving opportunities.
- Published: 26 July 2016 26 July 2016
Last year a break valued by many charitably inclined retirees was made permanent: the charitable IRA rollover. If you’re age 70½ or older, you can make direct contributions — up to $100,000 annually — from your IRA to qualified charitable organizations without owing any income tax on the distributions.
- Published: 22 July 2016 22 July 2016
You can only deduct losses from an S corporation, partnership or LLC if you “materially participate” in the business. If you don’t, your losses are generally “passive” and can only be used to offset income from other passive activities. Any excess passive loss is suspended and must be carried forward to future years.