One COVID-19 Tax Relief Fact That Retirees Should Understand!
These are trying times and we all have information overload, but one small piece of the new emergency tax relief legislation that seems “lost in the sauce” is perhaps the most important for retirees. There was a last minute push for seniors to be included in the $1,200 relief checks, although if retired and on fixed income they are “less affected in theory.” Many are supporting in some way a family member, child or grandchild, so we believe this was fair and the right thing to do. However, it’s only $1,200, and the real gem for most retires has not been featured much in the media, as our focus has been on our collective health. IF YOU’RE OVER
What Is Tax Planning?
We use the term “Tax Planning” often, but we are aware that many people are not sure what it really is. Some people think “That means off shore accounts and citizenship shell games ending with jail time. No thank you!”. That is not tax planning; that’s tax evasion, and it’s not at all what we recommend. Others think only the wealthy need a tax planner, and for regular folks it can mean paying a 30 year mortgage off 12 years early or having a college fund with enough in it to actually pay for college. It’s not just for the wealthy, though. Tax planning can be a useful tool for anyone who is aware of the opportunities. Our tax code
It’s Not All Bad News. Roth Conversions In A Down Market Can Be A Big Win!
For many Americans the bad news surrounding the current crisis is all consuming. Even for those not living check to check, it can still be very stressful. Employers struggle with using savings, loan lines or selling assets to keep afloat. Others face layoffs of workers that are practically family members. There is a lot of heartache out there, as everyone knows. When you find any silver lining you almost hate to even bring it up. How dare you be positive about anything right now? Well I’m going to risk it. Now is an excellent time if you have an IRA and have been planning (or should be planning) to do a Roth Conversion. If your IRAs have shrunk like mine,
It’s Better To Give To Charity From Your IRA Than It Is To Hand Them Cash!
This tax law became permanent but it’s still very underutilized. Many others are as well! I know on first read this probably sounds complicated, but it’s very simple. It’s better to take the income off your tax return than to take the deduction. It’s a win and it’s now permanent. There are numerous other tax planning opportunities to take advantage of, some of which are listed below. To utilize these deductions properly does take some forethought and planning. Permanent, now in the tax code; Qualified charitable distributions (QCDs) from IRAs Deduction for state/local sales tax is limited Even higher education credits (American Opportunity Tax Credit) Teachers’ classroom expense deduction Code Section 179 deduction is even bigger Because these have been
Check Your Business Tax Return for QBI Deduction!
If you own any size business, now is the time to review your business return to make sure you are receiving the maximum allowable “QBI” deduction. The public and many preparers still don’t have their arms wrapped around how this deduction works and many mistakes are being made! Whether you file as a sole proprietor, S corp, partnership or PLLC; if your business income ends up flowing through to your 1040, you should be paying attention to this. Some trust returns and C corporations have different tax rates and they pay their entity taxes directly, but the majority of businesses in the U.S. are eligible to at least try to receive a qualified business income (QBI) deduction. There are more
Taxes Are Due In
On Point Tax Group, LLC
Kennesaw, GA 30144
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