Here are ten possible indicators that might improve your personal situation:
1. A large tax due and little or no tax withholding – You may not be managing your tax liabilities during the year. Are there other debts that you’re not managing? READ MORE
While our representatives in Washington attempt to come up with a plan to avoid a national financial cliff, many of my clients are attempting to deal with the uncertainty that abounds. My advice is to focus on what you know, and what you can control.
Here’s a short list of the more significant tax changes scheduled for January:
- In California, sales tax will increase by .25%.
- Medical deductions on your Federal return will have to exceed 10%, and not 7.5% of Adjusted Gross Income.
- Flexible spending account deductions will be reduced. READ MORE
If watching home values fall and gas prices go up leaves you feeling like you’re caught in the middle and being squeezed real hard, it may be time to make some changes in the financial areas that you can control. For most people, the place to start is with housing expenses.
If your housing expense is your largest expense, you may want to downsize or refinance. Can’t refinance because your home is underwater? Now you may be able to — thanks to HARP 2.0. READ MORE
Some of you may have already received a notice from your mutual fund companies or your brokerage firms asking what method you would like used to determine the cost basis of your holdings. Perhaps you’re not sure
what cost basis is,
what are the different methods to calculate cost basis,
which method is best for you, or how you will make a choice,
No, I have not yet begun to dip into the eggnog. I am talking about doing some tax loss harvesting in order to reduce your tax liability. What is tax loss harvesting? READ MORE
As you may or may not remember, I do some tax preparation. I say “some” as I just began doing individual income tax preparation last year. Well, this year I had the opportunity to do the taxes of a retiree with significant assets and investment income. And as I saw the total tax liability rise, I began to look for deductions. Finally it struck me that there must be some offsetting investment expenses.
Here are a couple of the most relevant changes that will affect or benefit most of you. If you want to read highlights on all the changes or you want more detail, the IRS web page has a great article.
In the Breeze –
A first time home buyer credit of up to $7,500 is available for homes purchased from 4/9/08 – 6/30/09. “First Time” really means any individual who has not owned a home for the last three years. READ MORE