Tax Guide for Investors

Good Time to Think About Roth Conversion

January 14, 2015

Roth retirement accountsWe often think in terms of year-end tax planning, but there are some moves that can be especially advantageous early in the year. A Roth conversion is one of them.

details: Roth Conversion Early in the Year

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Nonqualified Options? Don’t Ask the IRS

January 12, 2015

Compensation in stock and optionsWe recently added some material on how to report sales of stock you acquire by exercising a nonqualified option. In the course of doing that we took a look at what the IRS has to say on the subject. Not much, it turns out — and some of what they say isn’t accurate.

details: The Sorry State of IRS Guidance on Nonqualified Options

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Stock Acquired from Your Spouse

January 9, 2015

Taxation of InvestorsThe rule for determining the basis of stock you acquire from a spouse, whether by gift, purchase, or divorce settlement, is simple and, to many people, surprising. Gifts don’t follow the usual rule for gifts. As for what happens when you buy stock (or anything else) from your spouse (or from your former spouse as part of divorce proceedings), you may find the result hard to believe.

details: Acquiring Stock from Your Spouse

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New Capital Gains Book Available

January 6, 2015

The 2015 edition of our capital gains book, Capital Gains, Minimal Taxes, is now available. This is a major revision from the previous edition, covering changes in tax rates, broker reporting, mutual fund averaging, and the net investment income tax, among other enhancements.

more info  |  order from amazon.com
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Eager to File?

December 29, 2014

Filing your taxesCountdown to tax season: The IRS has announced that it will begin accepting electronic returns, and begin processing paper returns, January 20.

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Tax Extenders Law Signed

December 20, 2014

On December 19, President Obama signed the law passed by the lame duck Congress to extend expired tax provisions through the end of 2014. As previously reported, the law retroactively restores provisions that expired at the end of 2013, such as the deduction for state and local sales tax. These provisions are extended only through the end of 2014, so further action from the new Congress will be necessary to make them available in 2015 or later years.

The legislation also includes technical corrections to earlier legislation and provisions making it possible for states to offer ABLE accounts, similar to 529 accounts but used to cover expenses of certain individuals with disabilities.

details: Tax Increase Prevention Act of 2014

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New Rule for 529 Account Investments

December 17, 2014

College savingsThe college savings plans known as 529 accounts have advantages but also some disadvantages, including a rule that restricts how often you can change your investments. The tax law passed by Congress at the end of its 2014 lame duck session includes a provision that loosens up that restriction as of 2015.

details: Changing 529 Account Investments

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2014 Tax Extenders Move

December 4, 2014

Seal of the U.S. CongressUpdate: The Senate passed this bill on December 16, sending it to President Obama for his signature.

It’s not a done deal yet, but Congress appears to be heading toward a one-year extension, through 2014, of various tax provisions that expired at the end of 2013. Many extenders are included in various categories including business and energy. Here are the extenders for individuals:

  • Tax-free distributions from IRAs for charitable purposes
  • Deduction of state and local sales tax
  • Above-the-line deduction for qualified tuition
  • Mortgage insurance premiums treated as interest
  • Parity for employer-provided mass transit and parking
  • Exclusion of income from discharge of certain mortgage debt
  • Contributions of real property for conservation purposes
  • Deduction for certain teachers’ expenses

The House passed the bill 378-46 but the Senate has yet to act and the Senate has now passed it as well.

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Investing: All You Need to Know

November 24, 2014

PennyIs it possible to say all you really need to know about investing in 100 words? Judge for yourself.

details: Investing in 100 Words

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Another Change in the Rollover Rules

November 13, 2014

We have further guidance from the IRS on another change in the rollover rules. This one has to do with the rule saying you have to wait a year after doing a 60-day rollover from one IRA to another before you do another. The IRS announced earlier this year that it would apply a stricter interpretation of the rule beginning in 2015. A November 2014 announcement clarifies the earlier guidance.

details: One Rollover Per Year

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