If you are the kind of person that likes hot tips on anything, you will certainly enjoy the tax tips in this article as they will help you to reach the financial freedom that eludes so many people. Be forewarned that since tax laws are constantly changing, tax tips must also constantly change due to the never ending tax law changes that are handed down to us from our government. The reader is advised to check with their own tax professional to see how these tax tips affect their own situation.
When you are deciding where to place your purchased securities such as in a taxable account versus a tax advantaged retirement account you need to be mindful of the current tax implications. For instance, Bond interest payments that you receive are taxed at ordinary income rates, up to 35%,which is usually higher than the long term capital gains rates of 15% right now but could increase to 20% in 2013.
The final quarter of the year is a good time to “harvest” investment losses. If you have gains in your portfolio that you have to pay tax on, this is a good time to get rid of your losers to offset the gains. You can offset all your gains with losers plus an extra $3,000.00 more. If you have even more than that in losses, the amount over $3,000.00 is carried forward to use the following year.