Our weekly roundup of tax-related investment strategies and news your clients may be thinking about.
Coming up with extra deductions to boost a refund is no easy feat, according to Kiplinger. However there are a number of write-offs that normally would seem unimaginable to a client and their adviser. Take the couple who owned a junk yard and successfully wrote off the cost of cat food they set out to attract wild cats. The feral felines did more than just eat.
They also took care of snakes and rats on the property, making the place safer for customers. When the case reached the Tax Court, IRS lawyers conceded that the cost was deductible. -- Kiplinger
From a tax perspective, donating required minimum distributions from a traditional IRA to a qualified charity is a smart move for retired clients, according to The Wall Street Journal.
From recommending wrong share classes to cherry-picking allocations, these are the pitfalls advisers should avoid.
Although retirees cannot claim a tax deduction on the charitable donation, the RMD amount is excluded from computing their adjusted gross income. A lower AGI would enable them to reduce or avoid a 3.8% surtax on net investment income, Medicare premium payments and taxes on Social Security benefits. -- The Wall Street Journal
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How a couple wrote off cat food and other breaks that boosted refunds. Plus, how charity counts toward an IRA withdrawal.
February 14 -
There are ways around having to pay as much as a 50% penalty. Plus, inheriting Roth IRAs and designing more efficient retirement portfolios.
January 31 -
Moving investments into these accounts may optimize returns and boost savings. Plus, know your IRAs and the impact of Trump's proposals on income brackets.
January 25 -
Why it's a good time to invest even small amounts into 401(k) and Roth IRA accounts. Plus, avoiding the capital gains hit.
January 17
Clients can avoid federal taxes on the sale of a home when the property was their primary residence two out of the last five years prior to the deal and the capital gains fall below certain thresholds, according to The Washington Post. However, the calculations for such tax treatments can get complicated. -- The Washington Post
