If you make too much money to open a Roth IRA, you could create one this way. You can sum up the appeal of a Roth IRA in three words: federal tax benefit. Potential earnings in a Roth IRA grow tax free as long as the owner abides by the Internal Revenue Service (I.R.S.) rules, and withdrawals are federally tax free once you reach age 59½ and have held the Roth IRA for at … [Read more...] about “Backdoor” Roth IRAs
Tax Strategies
New I.R.S. Contribution Limits
Changes for 2020. The I.R.S. just increased the annual contribution limits on IRAs, 401(k)s, and other widely used retirement plan accounts for 2020. Here’s a quick look at the changes. *Next year, you can put up to $6,000 in any type of IRA. The limit is $7,000 if you will be 50 or older at any time in 2020.1,2 *Annual contribution limits for 401(k)s, 403(b)s, the … [Read more...] about New I.R.S. Contribution Limits
What if You Get Audited?
What the I.R.S. looks for and why. “Audit” is a word that can strike fear into the hearts of taxpayers. However, the chances of an Internal Revenue Service audit aren’t that high. In 2017, the most recent statistics available, show the I.R.S. audited 0.5% of all individual tax returns.¹ Being audited does not necessarily imply that the I.R.S. suspects wrongdoing. Th … [Read more...] about What if You Get Audited?
Tax Moves to Consider in Summer
Now is a good time to think about a few financial matters. Consider making tax moves earlier rather than later. If you own a business, earn significant investment income, are recently married or divorced, or have a Flexible Savings Account (FSA), you may want to work on your income tax strategy now rather than in December or April. Do you need to pay estimated income … [Read more...] about Tax Moves to Consider in Summer
Tax Efficiency
What it means; why it counts. The after-tax return vs. the pretax return. Everyone wants their investments to perform well. But for many investors it’s their after-tax return that may make all the difference. After all, even if your portfolio is earning double-digit returns, it may not matter if you’re also losing a percent of those earnings to taxes.1 Holding onto ass … [Read more...] about Tax Efficiency
Roth IRA Conversions
What are your options? What are the benefits? If you own an Individual Retirement Account (IRA), perhaps you have heard about Roth IRA conversions. Converting your traditional IRA to a Roth IRA can make a lot of sense depending on your situation. But remember, consulting with your financial advisor before making financial decisions is never a bad idea. Ready to learn … [Read more...] about Roth IRA Conversions
Section 199A Business Tax Deductions
A deduction intended for pass-through business owners Many households, businesses, and other organizations are arranging their documents for the coming tax season. The changes to the tax code have inspired a great deal of discussion, confusion, and clarification. Something you might want to know, as a business owner. There’s a tax cut that many may not be aware of, b … [Read more...] about Section 199A Business Tax Deductions
A Look at HSAs
Health Savings Accounts may provide you with remarkable tax advantages. Why do higher-income households inquire about Health Savings Accounts? They have heard about what an HSA can potentially offer them: a pool of tax-exempt dollars for health care, a path to tax savings, even a possible source of retirement income after age 65. You may want to look at this option … [Read more...] about A Look at HSAs