Displaying items by tag: taxes

Monday, 27 December 2021 21:39

Wealth Tax Back on Table in Biden Bill

Joe Manchin, Democratic Senator from West Virginia, made a splash last week when he pulled his support for the build back better citing a number of problems that keep him from backing the bill. However, this week Manchin did a 180 on the billionaire tax saying he would be willing to support it in a revised version of the bill. Manchin’s version of the bill includes many of the same spending appropriations such as pre-k care, climate change, and Obamacare, but omitted certain pieces like the child tax credit. Manchin’s vote is critical if Biden hopes to pass the bill, but with rising inflation, labor shortages, and spiking national debt, he’s still reluctant to throw his weight behind Biden’s bill.


FINSUM: Remember the House’s version of the bill didn’t include a billionaire tax, even if Manchin puts it back on the table it’s unlikely the final bill will include it.

Published in Wealth Management
Thursday, 23 December 2021 17:38

Biden and Democrats’ New Tax Plan

Biden’s latest $2 trillion stimulus/economic reform bill is stuck in congressional limbo, and that's because not even all Dems are on board. Speaking on behalf of moderates Joe Manchin, Democratic Senator of West Virginia listed an array of suggestions to Biden in order for there to be bi-partisan support. Some of Manchin’s suggestions included means testing and work requirements for expanded child tax credits in order to stop wealthier individuals from taking advantage of the program. Other democratic senator’s ae calling for a smaller corporate tax hike and lower income taxes on weather individuals. Manchin accused staff of adding in provisions that are limiting bi-partisan support, and even having a hard time garnering support in their own party.


FINSUM: The lofty aims of Biden’s original economic reform were a pipe dream, major changes will have to come if they want to have a chance of passing the bill.

Published in Wealth Management
Wednesday, 22 December 2021 19:04

Tax Loss Harvesting to Reduce Your Burden

Crypto went on a wild ride this year as regulators from the globe sent the price in terms of dollars on a rollercoaster. However, some individuals might need to minimize their tax burden and crypto could provide some outs. If not all of your coins took off or better yet if you jumped in on Doge coin at the wrong time now is the time to sell off some coin and realize the gain for some optimal tax loss harvesting. Investors can also take advantage of the fact that wash rules don’t apply to Crypto until 2023, which means you can buy and sell your coins within a 30 day period to help minimize your tax contribution. Finally, investors can utilize a donation of cryptos above their fair market value to write off a charitable donation from your final tax bill.


FINSUM: Cryptos up and down roller coaster ride gives investors holding it an advantage in tax loss harvesting, and particularly when it comes to capitalizing on the Wash rules applicability.

Published in Wealth Management

Investors need to be more active with their finances and taxes as they enter retirement because it's not the time to coast as many presume. One of the areas retirees underestimate the costs of retirement and permanently puncture their safety net is in healthcare. Hefty premiums hit most Americans due to the Affordable Care Act once you hit 50, and most Americans who retire before Medicare will face a shocking bill. There are lots of healthcare tax credits available for those with low and middle incomes, and bigger benefits if healthcare costs breach 7.5% of adjusted income. Finally, Roth conversation ladders will dramatically impact your healthcare costs.


FINSUM: It’s critical to be informed about all of the tax benefits those approaching or entering retirement can take advantage of pre-Medicare.

Published in Wealth Management

The roaring post comeback of equities post pandemic has been wonderful but investors have few places to turn to mitigate their tax bill, except for the bond market. All major categories in the S&P 500 were up this year, and enjoying the broader rally. Bonds have suffered and so have many bond ETFs however, the glimmer of hope is how they can contribute to help offset tax loss. Bond ETF holders will already be in a better position just given their construction and exposure to taxes, and investors are also jumping between fixed income ETFs to manage fees as some ETF managers are cutting in order to synchronize for the tax loss harvesters. However, the 2-3% fall off in bond ETFs won’t be enough to entirely offset the equities rally this year.


FINSUM: This is the perfect time to capture low fees in bond ETFs because they are mainly a tax vehicle at this moment and return is secondary.

Published in Wealth Management
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