 |
Greetings!
On behalf of the staff at Ciampi Tax and Financial Services, LLC, I take great pleasure in introducing you to our eNewsletter!
Holding true to our commitment to provide our clients with the most valuable tax information, we created a Summer eNewsletter that may be beneficial in planning and preparing for the future. Each article contains useful information such as the debt ceiling crisis, new Connecticut tax increases, tax deductions, and financial planning.
For further resources, please be sure to click the link to our direct website where you will find the latest and most effective money-saving strategies.
We will be sending out our eNewsletter to you periodically throughout the year. Your thoughts and opinions matter to us; feel free to add your comments and suggestions by clicking on the link to the right.
I would like to take this opportunity to personally thank you for your continued interest in our firm. We hope that you enjoy your summer.
Best Regards,
Donald J. Ciampi Sr., EA |
| Protect Your Investments | |
In uncertain economic times, it is more important to consider ways to protect your investments. Asset diversification is one of the only ways to protect your portfolio. You should consider the following investment strategy as a blueprint for bumpy times.
Here are some tips to ensure growth of your portfolio:
Active Account Management: Don't hesitate to sell those investments that have a significant gain or loss. Look for newer funds which are smaller with a strong 1 to 5 year track record. Smaller funds and ETF's are more nimble and can take advantage of market trends more quickly.
International Investing: Don't be afraid of it! Today only 40 percent of American investors own international investments. During the past decade, foreign stocks outperformed the U.S. stock market by 2.2 percent. Our recommendation is to own up to 25 percent in foreign stocks based on your age and risk tolerance.
Alternative Investments: We suggest you invest up to 10 percent in areas such as: commodities, long/short term funds, and real estate investment funds. ETF's are a great way to own specific commodities such as gold, oil, natural resources, and other precious metals. Real estate funds have performed very well since "the crash of 2008" because they also own residential and commercial rental properties.
Active management using these strategies should yield you a better portfolio than a buy and hold approach with traditional stocks or mutual funds.
|
| The Largest Tax Increase
In Connecticut State History | |
 After much debate and discussion, Connecticut's new tax package took effect on July 1, 2011. So, what does this mean for us? Instead of paying 6 percent tax on general sales, we will now be paying 6.35 percent. Moreover, the following purchases or services will no longer be tax free: the purchases of clothing under $50 (including consignment stores), nail and spa services, pet grooming, motor vehicle towing and services, yoga instructions, packing and crating, and removal of hazardous waste or other contaminants of air, water or soil.
And don't think that's all! Your beer and wine will cost more too since there is now a 20% increase on alcoholic beverage tax. This tax is mainly paid by the wholesalers; however, consumers will notice the increase in the shelf price to compensate retailers for the additional cost. Thinking about some nip and tuck? Think again. Cosmetic medical procedures will be subject to sales tax as well.
Have an itch to spend money on luxury items? There is now a 7 percent tax rate on luxury items such as boats that cost over $100,000, cars over $50,000 and jewelry over $5,000 (whether it is real or imitation). Additionally, articles of clothing or footwear intended to be worn on or about the human body, (i.e. a handbag, luggage, umbrella, wallet or watch) which sells for $1,000 or more will incur the 7 percent sales tax.
Are family and friends visiting you often? They can expect to feel the burden of Connecticut's taxes as well. The room occupancy tax was increased from 12 to 15 percent for all stays fewer than 30 days. In addition, all car rentals are now taxed at 9.35 percent instead of 6 percent.
Good news! If you didn't have time to get your tax-free shopping in before July 1st, don't panic. You will have another opportunity when Connecticut holds their tax free week from August 21 - 27, 2011. By planning ahead, you will be able save your family some extra cash. In addition, don't buy items you don't need just because they are tax-free. After all, the sales tax rate in Connecticut is now 6.35 percent, so that amount - in addition to any local sales tax - is the amount that you would be saving during this week. Also, it is still possible that you will be able to find better sales before or after the tax-free week. So keep your eyes peeled for advertisements and special promotions around town to save a few extra bucks. |
| Deductions! Deductions! Deductions! | 
Although many people believe that buying a home is the biggest expense they'll incur, they are wrong. The truth is, you pay more in income taxes over your lifetime than paying for your house! To minimize this expense, here are some tax deductions that can be beneficial.
With summer underway, air conditioning is a must. Schedule to install an energy saving central air unit and you could receive a credit up to 10 percent of the cost. The current tax law allows you to claim this credit. However, don't delay - the credit is set to expire at the end of 2011.
Gas prices are not the only reason you should look into purchasing a hybrid car. The benefit? A $7,500 tax break. In order to receive this tax break, there are a few qualifications that need to be met. These include: purchasing the car brand new and using it primarily in the United States. If you lease the car, the credit will go to the company you leased the car from and not to you.
In order to compensate consumers for the major increase in gasoline prices, the Internal Revenue Service announced that the standard mileage deduction will increase to 55.5 cents per business mile driven as of July 1, 2011. This is almost a 9% increase from the original 51 cents allowed during the beginning of 2011. There are two ways you can calculate your deduction. You can either A, multiply the total business miles driven during the year at .555 for the last six months and .51 for the first six months, or B, you can base your deduction on the percentage of miles your vehicle was driven for business multiplied by the actual cost incurred. Actual costs incurred include: gas, insurance, lease payments, and repairs. Generally, option B is the more valuable option since your deduction will usually be higher.
|
Business Mileage Rates | |
2010 |
$0.500 | | 2011 (through 6/30/11) | $0.510 | | 2011 (starting 7/01/11) | $0.555 |
|
| Our Growing Staff | |
As we continue to grow as a firm at Ciampi Tax and Financial Services,
 | |
Steven Fazo, CFA |
LLC, we feel as though our staff must grow as well. We would like to introduce you to our new associate, Steven Fazo. Steven is a Chartered Financial Analyst (CFA). He will assist Donald J. Ciampi Jr. with portfolio and investment analysis where he will review and construct investment products and create client portfolios. Steven graduated from Fairfield University with a Bachelor's Degree in Economics and continued his education to receive his Master of Business Administration at Yale University. Prior to joining us, Steven has worked at Goldman Sachs on their foreign exchange operations desk, as a fixed income analyst at State Street Research, and as a portfolio manager for the Hartford Steam Boiler. We are excited to welcome Steven to our team.
|
|
|
|
|
| | Featured Article | |
In uncertain economic times, it is more important to consider ways to protect your investments. Asset diversification is one of the only ways to protect your portfolio. |
|
|
