With millions of baby boomers close to retirement age and job losses inflicting financial strain on additional millions, many taxpayers are looking to social security benefits for financial assistance. So, we thought this would be a good time to discuss how social security benefits are taxed by the federal government. Individuals may have to pay [...]
The increasing costs of higher education have made education planning an important aspect of personal financial planning. However, education planning does not always receive the necessary attention required because some parents are counting on scholarships to cover the cost of their children’s education. Others procrastinate, as they do with retirement planning, because the actual expenditure [...]
Thanks to the extension late last year of the 2001 and 2003 tax cuts, the current federal income tax environment remains favorable. Now is a good time to take advantage of the low tax rates because we obviously can’t predict future tax rates. This article presents several tax planning ideas to consider this fall while [...]
Deciding whether it is advantageous to roll over a qualified retirement plan account (e.g. 401(k) account) to a IRA depends on the taxpayer’s specific circumstances. However, there are some general advantages: 1. Postmortem Tax-deferral Opportunities. Beneficiary designations as of the date of the owner’s death control the availability of various postmortem tax-deferral opportunities. Therefore, it [...]
Congress continues to discuss tax reform and whether taxes and spending should be raised or lowered. One of the topics being bantered about is whether long-term capital gains rates should be increased. Although it is difficult to say where tax rates will go in the future, we have a pretty good idea of where they [...]
Many businesses continually make expenditures to improve and maintain business property. However, it is not always clear whether the amount incurred to repair or refurbish that business property is a capital expense or an incidental repair. Proper classification is critical because, for federal tax purposes, capital expenditures (see below) must be added to the property’s [...]