Got mutual funds? Pay attention to year-end tax issues

If you’re among the millions of Americans who invest in mutual funds, you need to be aware of the year-end issues that could affect your 2020 tax bill. Year-end distributions. One key fact to be aware of is that mutual funds are usually required to distribute their income annually to shareholders. If you purchase a…

Four Tax Moves to Make Before 2020 Ends

Here are a few time-tested tax strategies to consider as we head towards the end of 2020: Maximize retirement plan contributions. You’ve heard this advice many times, because it’s one of the best strategies for saving tax dollars, especially when wages are your primary source of income. The maximum contribution to a 401(k) for 2020…

This Estate Planning Mistake Could Cost You Thousands

While you may never need to worry about forking over an estate tax payment to the federal government, there is a financial trap hidden within your estate that could bite you big time. Spend a few minutes with the following example to see where you could get tripped up by a simple mistake that could…

Don’t Let Plummet in IRS Audits Lead to Complacency

Prepare for an IRS audit despite a low risk for getting selected. In 2018, the most recent year for which the IRS has released information, you have a 0.05% chance of getting audited if you make more than $1 million. In comparison, if you made more than $1 million in 2010, you had a 9.72%…

Timing Matters When Paying Education Expenses

As college tuition bills begin arriving for the fall semester, start thinking about education tax credits. Why? The two federal education credits available – the American Opportunity Credit and the Lifetime Learning Credit – include timing rules. For example, say you’re planning to pay qualified tuition expenses with loan proceeds. You can claim an education…

Donating Stock to Charities Can Yield Bigger Tax Savings

Scrolling through your inbox, you come across an e-mail from your favorite charity asking for a donation. You’ve been meaning to make a contribution for a while now, but just never got around to sending them a payment. But you’re ready to do it now, and you’re cyber smart, so you avoid the e-mail and…

Is a Tax Time Bomb Lurking in Your Paycheck?

Does your paycheck look a little higher than normal? If so, it could be a tax time bomb. The Problem A payroll tax deferral beginning September 1 was recently signed via a presidential executive order. This deferral of the employee’s portion of Social Security will raise your paycheck temporarily until January, 2021. Beginning in 2021,…