Income Tax PlanningTax Planning
"There are two systems of taxation in our country; one for the informed and one for the uninformed...Over and over again Courts have said there is nothing sinister in so arranging one's affairs as to keep taxes as low as possible. Everybody does so, rich and poor, and all do right, for nobody owes any public duty to pay more than the law demands. Taxes are enforced exactions, not voluntary contributions. To demand more in the name of morals is mere cant."
--Honorable Learned Hand, US Appeals Court Justice
Only the right tax planning strategies make the right financial plan. Whether you are managing a portfolio worth millions of dollars, or just barely making ends meet, it is essential that you consider the tax implications of your actions. Finding ways in which to legally and prudently minimize your individual tax burden through proper tax planning strategies and tax planning. We've started a collection of great articles about tax planning. If you find that the topics aren't sufficient for your needs, we suggest that you contact us regarding our premium package.
The Worker, Homeownership and Business Assistance Act of 2009 (WHBAA)
The Worker, Homeownership and Business Assistance Act of 2009 (WHBAA) was signed into law Nov. 6. Not only does the act extend unemployment benefits for millions of Americans, but it also extends and enhances the homebuyers credit and the five-year net operating loss (NOL) carryback election for businesses.
A Guide to the Alternative Minimum Tax (AMT)
The purpose of the alternative minimum tax is to ensure that everyone pays a fair share of tax. Essentially, a flat tax rate is applied on alternative minimum taxable income in excess of an exemption amount.
The alternative minimum tax (AMT), the government’s attempt to keep people from taking too many tax breaks, went into effect in 1983 and with TRA 1986 the rules were tightened. The alternative minimum tax concept was developed out of the favored or preferred status Congress gave to certain types of income, so-called preference items. To prevent some individuals with large incomes from paying little or no tax, the AMT was introduced. The Tax Reform Act of 1986 made the alternative minimum tax tougher and extended its provisions to thousands of additional taxpayers. Subsequently the Revenue Reconciliation Act of 1993 increased the rates still further.
New Ideas for Philanthropy to Reduce Your Tax Bill
When looking for ways in which to further reduce your income tax bill, the charitable deduction remains as one of the easiest ways to do so. This assumes that you have sufficient itemized deductions (including year-end charitable gifts) to not take the standard deduction.
While there is no rule prohibiting charitable donations to be made 365 days a year, unfortunately the vast majority of us choose to do our giving at year's end. We seem to get caught up by the holiday spirit and greatly increase our generosity in December. Rather than wait until the holiday season to begin a charitable giving strategy, I've compiled a couple of ideas for philanthropy that you can begin immediately.
How to Sell Highly Appreciated Assets and Pay No Tax
Did you know that for 2008 and possibly 2009 – 2010 you can sell assets that will generate long term capital gains and pay no tax! The law allows taxpayers to pay 0% on capital gains whose taxable income is inside their 15% marginal tax bracket.
This means for 2008 married couples filing a joint return whose taxable income is under $65,100 and includes long term capital gains, will not pay tax on those long term capital gains. Single tax payers would need to be under $32,550 including long term capital gains to take advantage. In addition to long term capital gains, qualified dividends are also taxed at 0% if taxable income is inside a taxpayers 15% margin.