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The highest-yielding investment might not pay you the highest after-tax income. That is because of the different tax rates created by the 2003 tax law. Investors who seek the highest yield following the old rules might have less cash to spend than they could have. Interest from bonds, certificates of deposit, money market funds, real […]
Tax planning was turned on its head by the last couple of tax laws. Several key planning rules need revisions for those who want to maximize after-tax wealth. One of the oldest tax planning rules is that it is better to defer a tax whenever possible. Paying taxes tomorrow is better than paying them today. […]
The marital deduction is key to most estate plans of married couples. It can wipe out the entire estate tax liability. But misuse of the marital deduction can create a larger long-term tax bill or cause non-tax problems. Let’s look at how to use the marital deduction and avoid misusing it. The estate tax is […]
We’re coming up on the day many retirees dread. It arrives four times each year. What many do not realize is that they easily can avoid this day. During their working years, most retirees had income taxes withheld from paychecks. They did not worry about making quarterly estimated tax payments during the year. The only […]
It’s another year, and many IRA owners have to focus on required minimum distributions (RMDs). The right strategy for these and other aspects of an IRA can make the account last longer. RMDs are mandatory after an owner is age 70 1/2. The rules apply to all qualified retirement plans, though we’ll focus on IRAs […]
The American Jobs Creation Act is a major tax law enacted quietly just before the elections. While primarily a corporate tax law, several provisions affect individuals and small businesses. Sales tax. In 2004 and 2005, individual taxpayers who itemize deductions have the option of deducting either state and local sales taxes or state and local […]
The rapid real estate appreciation of recent years endowed many families with substantial real estate wealth but not enough cash. Real estate appreciation does not produce cash. But it does result in higher property taxes, and there are maintenance expenses to pay. Some families also are disappointed with having paper wealth that cannot be spent […]
In early October, Congress voted to extend for another year the higher exemption amounts for the AMT that were enacted in the 2003 tax law. The exemptions were to expire at the end of 2004. Yet, many of you still are likely to be snared by the AMT. You need to carefully review your finances […]