How to Avoid Capital Gains Taxes
For many of the nation’s high net worth individuals, much of their wealth comes from capital gains. Capital gains are better than income because they are taxed at a much lower percentage than other income. While capital gains taxes could be going down under the Trump administration, it still pays to know every trick in the book to avoid paying more taxes on them than you have to.
With that mind, let’s look at some of the important tips you should know in order to keep your capital gains taxes low. One smart move is to use a tax-advantaged retirement account when you invest. When you use a retirement account to invest, your money is allowed to grow tax-deferred, instead of paying a tax on the gains like a normal investment. Plus, if you use a Roth IRA, even your withdrawals are tax-free.
Additionally, the longer you hold your investments the less you will pay in taxes. If you hold an investment for a year or less then you will pay a percentage rate equal to your ordinary income. If you hold them longer than a year your rates decrease substantially.
Always look for opportunities to sell your underperforming stocks in order to offset the gains from your successful stocks. This will lower your tax bill. Lastly, keep track of your home improvements so when it comes time to sell your home you can use those expenses as deductions from any gains you make on the sale price of your home.
https://www.fool.com/retirement/2017/02/07/4-tips-for-avoiding-capital-gains-tax.aspx
Choosing a Legal Form for Your Business
Choosing a Legal Form for Your Business In starting a small business, one of the first questions you should ask is what form of legal entity you should use or “How should I organize my business?” Also, as your business grows and changes, you should from time to time ask yourself whether the entity you…
Drafting a Partnership Agreement
Drafting a Partnership Agreement If you decide to organize your business as a partnership, be sure you draft a partnership agreement that details how business decisions are made, how disputes are resolved, and how to handle a buyout. You’ll be glad you have this agreement if for some reason you run into difficulties with one…
How to Bring in a New Partner
How to Bring in a New Partner By Matt Dickstein, Business Attorney In this article, I will give you a quick overview of how do you buy into a company to bring in a new shareholder or partner to help with your business. If you are on the other side of the table as…
The Pros & Cons of S-Corporation Status
The Pros & Cons of S-Corporation Status If the number of shareholders in your corporation is small, you may think that becoming an S-Corporation is the right move, but you should weigh the advantages and disadvantages first. Advantages of S-Corporation Status One of the main advantages of S-Corporation status is that it avoids the double…