Taxes

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Weekend Reading: Managing Taxes in Retirement: Income Thresholds versus Incremental Average Tax Rates

Here, past podcast guest, Wade Pfau, highlights how to strategize the withdrawal order between your three tax buckets (taxable, tax-deferred, tax-exempt) by utilizing two different distribution methods: The adjusted gross income (AGI) threshold strategy versus the incremental average tax rate method.

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Weekend Reading: Why Tax-Loss Harvesting During Down Markets isn’t Always a Good Idea

Amidst recent tumultuous market activity, one strategy you might consider deploying to negate losses is tax-loss harvesting; However, there are instances when this might only bring you a neutral outcome, or even cause you further loss.

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Weekend Reading: When Roth Conversions Go ‘On Sale’: Discounted Roth Conversions During a Bear Market Decline

Amidst market volatility, I believe there’s always some form of opportunity. Today, that comes in the form of tax planning and the option to maximize “discounted” Roth conversions.

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Weekend Reading: Now’s a Good Time to Focus on Tax-Loss Harvesting. Here Are 7 Tips.

Amidst today’s market volatility, selling securities at a loss to offset capital gains is one strategy that can help minimize taxes, especially after a market sell-off.

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Weekend Reading: When Do Social Security Benefits Become Taxable?

According to the Social Security administration, about 56 percent of individuals will owe federal taxes on their benefits, and determining if that includes you, as well as how much you could owe, draws down to pinpointing your provisional income.

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Weekend Reading: Retirement Reform Bill Could Slash Taxes

In case you missed it, the U.S. House of Representatives recently passed a new retirement security bill (SECURE Act 2.0), which is a revamp of the 2019 SECURE Act that overhauled various retirement tax rules.

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Weekend Reading: The ‘Yield-Split’ Method of Asset Location to Improve Tax Efficiency of Index Funds

We preach on the importance of tax efficiency at Howard Bailey, and one of my favorite go-to financial websites is taking that a step further, specifically in the realm of index funds.

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Weekend Reading: Preparing for the Great Sunset: What You Need to Know if Tax Code Provisions Expire

While new tax provisions proposed by the Biden administration might still be up in the air, there is one thing we can be certain of in the realm of tax planning: The expiration of the Tax Cuts and Jobs Act (TCJA) in 2026.

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Weekend Reading: Why Most Financial Advisors Do Not Provide Valuable Tax Planning

Tax planning is just as essential to any comprehensive retirement plan as income planning, legacy planning, etc., and it’s also why our team focuses on tax-minimization strategies as part of our Retire With Purpose™ Framework.

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Weekend Reading: 3 Strategies for Reducing Tax Risks in Retirement

A share of your earnings has always gone to Uncle Sam, and unfortunately, you’ll find the same holds true when it comes to your retirement income.

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Weekend Reading: Ed Slott: Hold Off on Backdoor Roths, and More Tips for Tax Season in 2022

With new tax and retirement legislation looming ahead, it’s more important than ever to be proactive when it comes to your tax efficiency.

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Weekend Reading: Maximizing the Step-Up in Basis by Gifting Assets Between Spouses

Presently, taxpayers have a roughly $12 million estate exemption per person. As such, a step-up in basis strategy can be utilized to help minimize capital gains taxes upon the sale of those appreciated assets.