 | | Chris Locher,CFP |
'Committed to your personal financial freedom and the financial security of your family.'
We strive to provide an independent solution that integrates tax preparation/planning, investment management and lifestyle and family protection to help simplify your financial life. Imagine what you could do with financial freedom? |
Avoid a 50% penalty on Required minimum distributions!
RMDs must be taken by Dec. 31, 2010 |
RMDs were suspended for 2009 but are back for 2010. If you or a family member is 70 1/2, RMDs must be taken from traditional IRAs and qualified retirement plans by Dec. 31, 2010 or you will receive a 50% penalty from the IRS. If you turned 70 1/2 during 2010 you can wait until April 1st of 2011 to take your 2010 RMD. If you choose to wait, then you will have TWO TAXABLE RMDs in tax year 2011, your 2010 RMD and your 2011 RMD. Learn more about RMD's... |
Sell your losers by year end and get a tax deduction!
Want some tax free income? |
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If you sell an investment at a loss, it is a capital loss. Your capital losses can be used to offset capital gains and up to $3,000 in  ordinary income. If you don't use all of your capital losses to offset capital gains or ordinary income you can carry forward the losses to future years. This can be done in taxable accounts only and is effectively sheltering some gains and income from taxes. Beware the wash sale rule. You cannot buy the same stock or mutual fund you sold for 31 days, or your loss will be disallowed. |
Lower your 2010 tax bill..
Tax savings moves to make now
If you itemize your deductions you can make an extra mortgage payment and don't forget your charitable contributions. Only mortgage interest is tax deductible so make sure at least some of your extra payment is interest and you don't have a prepayment penalty. When making charitable contributions remember to get documentation saying the items are in 'good' condition or a receipt if you make a cash contribution.
Also, increase your pre tax 401k contribution. Most companies allow online adjustments to 401k contributions effective immediately. You can direct a larger portion of your last paychecks to your 401k. 401k contributions lower your adjusted gross income, which is the number most tax deductions are based on, the lower your AGI the better.
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