Tax Reduction
The accountant's cap indicates the importance of considering the tax
affect of your money moves. Tax implications can be key to achieving your financial goals. One
dramatic way to realize the impact of taxes is to mark National Tax Freedom Day
on your calendar.
What is it? No, it's not the day you die. (You or rather your estate may
pay more taxes on that day than during your life.) National Tax
Freedom Day is a date which helps you understand the burden of taxes on your paycheck. It
is the day the average American
has met all tax obligations for the current year. The specific date is
determined after all taxes, i.e., federal, state, and local are fulfilled for the
year. Hence, the 2009 date cannot be computed until late in 2010. TAX FREEDOM DAY
for 2008 was April 23. To read the full report click here.
How do you lessen the impact of taxes? By taking advantage of the
beneficial treatment Federal and State tax codes offer
certain financial strategies and products . We call this; "TAX - ADVANTAGED MONEY
MOVES". For example, what do you do with the sea side condo
("investment property") you no longer wish to rent? If you sell it
outright, you may incur a heavy hit from capital
gain taxes. The answer may be a 1031 exchange (a swap with like kind
property through a third party). This strategy saved a client of ours
over $23,000 in capital gain taxes. To learn more about 1031 exchanges,
click here.
