Welcome to Part 6 of the ol' blog's 2020 series on tax inflation adjustments. We started on Nov. 6 with a look at next year's income tax brackets and rates. Today we look at how the annual changes help investors their families and eventual heirs. Note: The 2020 figures in this post apply to 2020 returns to be filed in 2021. For comparison purposes, you'll also find 2019 amounts to be used in filing 2019 returns due April 15, 2020. OK, maybe the rich don't literally burn money. But as the saying goes, the very wealthy really are different from... Read more →
Investing Capital Gains
November is the place for perfectly roasted Thanksgiving bird, not the many tax turkeys that can gobble up your money. These monthly tax moves are a great garnish as you finalize your 2019 tax year menu. Turkey attack from South Park via GIPHY It's November. You know what that means. Year-end tax move time. Oh yeah, and holiday plans. I hear ya. It's that crazy hectic part of the year, whether you're the host/hostess with the most/mostest or planning to travel to your Thanksgiving festivities. But you also need to add taxes to the mix. Now. Before you get all... Read more →
U.S. Sen. Ron Wyden (D-Oregon) during a recent Senate Finance Committee hearing. (Screenshot from Wyden's YouTube channel) Most of the tax the rich action has been coming from Democrats who want to move into the White House in 2021. Now a top Senate tax committee member has joined the call to collect more from wealthier Americans. And he has specific plans for the new revenue. Sen. Ron Wyden's proposal would tax ordinary income and capital gains at the same rates. Currently, capital gains generally are taxed at lower rates, ranging from zero for some lower-income investors to 15 percent for... Read more →
The market is still volatile, dropping a bit today because … heck, who really knows exactly why this time? It's likely to keep bouncing a bit until the current and threatened trade wars and associated tariffs are resolved. I definitely am not a financial adviser, but even I know that you shouldn't try to time the stock market. Just when you think you've hit the bottom and cashed out, it drops more. Or it recovers and you miss a run back up that would have replaced (or more) your assets' losses. But if, after careful consideration and consultation with your... Read more →
Donald J. Trump speaking to supporters at an Aug. 15 rally in New Hampshire. (Photo from Trump's official personal Twitter feed) "If for some reason I wouldn't have won the [2016] election, these markets would have crashed. That'll happen even more so in 2020. See, the bottom line is … you have no choice but to vote for me because your 401(k), everything is going to be down the tubes. So whether you love me or hate me, you've got to vote for me." — Donald J. Trump Trump's recent campaign rally exhortation that people had to vote for him... Read more →
With markets down, it could be time to harvest tax losses or perhaps convert a traditional IRA to a Roth retirement account. What's scarier than Superman, the 415-foot tower roller coaster at Six Flags Magic Mountain in Valencia, California, that hits triple digit speeds? Some investors might say the recent stock market gyrations. (Photo courtesy Six Flags) Is the recent stock market drop freaking you out? How about the roller coaster ride back up, at least for a while, today? Yeah, it's worse than many stomach-churning amusement park rides and I'm right there, holding a barf bag, with you. But... Read more →
Oops! Someone at Topps was thinking about someone else when Shane, not Justin, Bieber's baseball card was produced. Did your mom throw out your baseball card collection when you went off to college? If so, you can start anew today, National Baseball Card Day, by picking up some brand spanking new cards. The Topps Company, the official trading card partner of Major League Baseball, is celebrating today by giving out free specially-made cards at MLB stadiums across the country, local hobby shops and a couple of major retailers. The new packs feature MLB stars and up-and-coming rookies. Lucky fans also... Read more →
UPDATE Aug. 21, 2019: In a stark reversal of yesterday's further tax cut considerations, Donald J. Trump today said he is no longer considering any such proposals. UPDATE Aug. 20, 2019: This proposal has bubbled back to the top of simmering economic stimulus ideas. As reports, predictions and fears of an impending recession increased, today Donald J. Trump again said he was considering indexing capital gains, which would give investors a big tax cut and primarily benefit the rich, and that he believed he could do it without approval from Congress. Members of the Upper Chamber of Congress are relying... Read more →
It's been a summer of change for my neighborhood. Several of our neighbors have moved, including our next-door neighbors that I really liked. My former suburban Austinites are heading off to new jobs, other subdivisions they've discovered or to be closer to families across the state or country. A few also decided it was time to cash in on the rising property values of our neighborhood. I must admit, that's crossed my mind, but then I think moving and … Summer is prime moving time regardless of the reasons. Things tend to slow down at workplaces, giving you more time... Read more →
Bitcoin and other virtual currencies fascinate me, but that's as far as it goes. I don't own and have never had any interest in cryptocurrencies. I'm basically a say it with cash kind of gal. Part of my crypto trepidation is that I've yet to grasp how Bitcoin is mined, despite the hubby's patient, and repeated, explanations. And like many Senators during a recent hearing on Facebook's proposed Libra digital money, I'm skeptical of the concept (as well as suspicious of the online social media platform proposing it, but that's another blog post). My disavowal of cryptocurrency, however, has been... Read more →
It's official. House Democrats have formally requested copies of the last six years of Donald J. Trump's personal and business federal tax returns. Trump has steadfastly refused to make public his taxes, breaking a modern-day tradition set by presidential candidates — and in-office presidents (and vice presidents) — of letting the public have a glimpse of White House 1040s. The main reason Trump has given for keeping his taxes private is that his personal and business filings are under audit. Tax experts throughout the media agree that no sane person would give their tax returns during an audit. After the... Read more →
April 1 could be costly for older retirement account owners. No fooling. That's the deadline for taking a required minimum distribution, or RMD, if you turned 70½ last year and did not take the specified amount from your tax-deferred retirement funds by Dec. 31. RMDs are, as the name says, required amounts that you must withdraw from a retirement plan that's been earning money over the years without you having to pay tax on it. The tax law has been letting these accounts ride for years, decades in many cases. But when you get halfway through your 70th year, the... Read more →
The tax filing season every year starts with a rush of flings. Last year, the Internal Revenue Service received more than 18 million returns (that's almost 12 percent of all the returns filed in 2018) during the first week the filings were accepted. This year appears to be on a similar track. Through mid-day Monday, Jan. 28, the opening day of the 2019 filing season, the IRS says it received several million tax returns. Those early filers obviously are expecting a tax refund. They also had all the documentation they needed to file their returns. Some of us, however, no... Read more →
Welcome to Part 6 of the ol' blog's 2019 series on tax inflation adjustments. Today we look at changes to estate, gift, capital gains and kiddie tax provisions. You can find links to all 2019 inflation posts in the series' first item: income tax brackets and rates. Note: The 2019 figures apply to 2019 returns that are due in April 2020. For comparison purposes, you'll also find 2018 amounts to be used in filing this year's 2018 tax return due April 15, 2019. The rich, per the apparently apocryphal F. Scott Fitzgerald characterization, really are different from the rest of... Read more →
Don't let tax turkeys gobble up your money. Make these tax moves, a couple of which are related to recent tax reform, this November and for sure by the end of 2018. South Park turkeys via Giphy It's November! The start of the holiday season. Time to get into the festive spirit with some year-end tax moves. "Whoa! Wait! What the what are you thinking?" you say. "I'm still adjusting to Standard Time and already have a huge to-do list to make sure my family has the perfect Thanksgiving. Then as soon as that's over, I've got to start with... Read more →
Some of my retirement money is in stock funds. They've been going gangbusters. Until this week. I'm fighting the urge to look at what's happened with these plans' value. Did they tank along with the broader market a few days ago? Or are they edging back up with today's sort-of recovery? I'm curious, but I don't need that money right now. And I believe my investment choices are sound. So I'm going to ignore the current market gyrations and just let things ride. That's the advice most financial gurus are offering now. This week's downward trend is just an overdue... Read more →
Americans have always been mobile, as evidenced by this vintage photo from Flatbush Moving in Linden, New Jersey. Now some folks say they're relocating because of new tax law limits on deductions. Now that the Treasury Department and Internal Revenue Service have made it clear that they will restrict state efforts to work around the new $10,000 cap on the deduction for state and local taxes (SALT), some folks are looking at other options. Among them, according to a New York Times story, is to move. (Unfortunately for them, the new law also, for the most part, ended the tax... Read more →
Summer is winding down, but someone needs to tell the thermometers. Across much of country, it feels like the mercury is about to burst and everyone is doing everything they can to stay cool. Sorry, I can't help you beat the heat. But I do have eight tax moves you can make in this eighth month of 2018 — which, with all those 8s, makes that this week's By the Numbers figure — that might be able to help lower the heat you're feeling when it comes to taxes. 1. Adjust your withholding. I know. I nag remind y'all of... Read more →
A week ago, the idea of indexing capital gains was just that, an idea. To move forward, the best bet was for the proposal to make it into Tax Reform 2.0. It didn't. So now it's looking more likely that the U.S. Treasury might act unilaterally. Treasury Secretary Steve Mnuchin had previously (all the way back in late June) said that he would prefer Congress take the lead on indexing capital gains. He did add, however, that "If we're not able to complete Tax Reform 2.0, then we'll go back to the drawing board and decide whether we want to... Read more →
Long-term investors already get a tax break. They pay lower capitals gains tax rates when they sell assets held for more than a year. That tax benefit survived the Tax Cuts and Jobs Act (TCJA). Now some Republican lawmakers want to protect even more unearned money from taxes. Tax and political considerations: Rep. Devin Nunes (R-California) has introduced a bill that would index capital gains to inflation. The Ways and Means Committee member says his Capital Gains Inflation Relief Act (H.R. 6444) "is a common-sense reform that will remove an unjust tax, contribute to economic growth, and help both large... Read more →