Articles by Donald Conrad
Equities for Income?
The following page contains two charts that can help you make wiser decisions to keep your income growing. Six Month CD Rates Figure 8. 1: CD Rates 1/1/75 through 12/31/00.
Turnover and Taxes of Funds
Many investors own mutual funds, but few of them realize how much they really earn after taxes. Here’s a little insight from Creating Equity by John Bowen. In a study commissioned by Charles Schwab and conducted by John B. Shoven, professor of Economics at Stanford University, and Joel M. Dickson, a Stanford Ph. D.
Tired of Another Big IRS Bill? Here's a Solution
For years, Congress has extended very powerful tax credits to attract investment into areas that Congress wanted to promote. Tax credits are about three times more valuable than a tax deduction. When you get a tax deduction, each dollar of deduction saves an average taxpayer about 33 cents in taxes.
Three Ways to Beat Taxes on Social Security Income
As retirees well know, the federal government takes back part of your social security through taxes. Depending on your level of income the tax can be levied on up to 85% of your social security benefits. Can you beat the tax? Yes, many can and here’s how. The general approach is to defer income.
Split Annuity Solution for Income and Tax Savings
If you’d like to take a slice out of your tax bill, the split annuity might be for you. The split annuity generates income, much of which is currently non-taxable. Here’s how it works. (Let’s assume a premium of $100,000. ) $70496 of the premium is placed in a deferred annuity to grow, guaranteed at 6% for six years.
Need to Save Some Taxes?
Periodically, I get a call from someone who sold some stock or property earlier in the year and wants to know what he or she can do to offset the large tax bill created by the sale. While planning before the sale provides a lot more options, there is still a way to save tax after the sale with a gift annuity.
How Your Family Partnership Can Save Big Tax Dollars
For years, the wealthy have been using estate planning techniques that are unfamiliar to many people who could benefit from the same techniques. For example, if estate taxes are a concern, read how you can use a simple device, the “Family Partnership,” to slice your tax bill.
How To Sell Real Estate and Avoid The Tax
Do you have a single-family rental property that was purchased years ago with big gains? It may not be convenient, but if you and your spouse move in and live there for two years, you can then sell and avoid tax on the first $500,000 of gain ($250,000 for a single taxpayer).
How to Ruin an Annuity
A woman recently came to see me about converting her annuity to a life insurance policy. Her husband had died four-and-a-half years ago and the annuity had been left to accumulate. I was horrified to find upon reading through the original annuity that the agent had written the annuity so that the children were the beneficiaries.
How to Pay Only 10% Capital Gains Tax
Many taxpayers think that the capital gains rate was cut to 20% in 1997. That’s right, but it’s only part of the story. Many investors qualify for an even lower 10% capital gains rate.
Hey Buddy, Need a Tax Break?
If you would like to generate a significant tax deduction, consider giving away your house, but don’t move out! Many charities will work an agreement with you to take your house as a bequest when you pass away, and yet provide you with the charitable deduction this year.
Free Tax Review
Although you’d like your accountant to give you tax tips, many do not. They simply prepare your tax return and let you go to accumulate another tax bill for next year. If you seriously want to cut your income taxes, go see your accountant or financial advisor before December 31.
Four Ways to Avoid Capital Gains Taxes
There are at least four ways that I know of to eliminate capital gains tax upon the sale of an asset. I have outlined these ideas for you below. 1. Before the sale, donate the asset to a charitable remainder trust and have the trust sell it and then provide the income to you. 2.
Capture This Tax Benefit Each Year
Every year, thousands of investors in stocks and mutual funds miss the benefit of tax loss selling—when an investor has the government share his or her investment losses by reducing his or her taxes.
Worst Time for Seniors in Twenty Years
Seniors are more affected by declining interest rates than any other group, since many of them depend on income from investments. I still meet retirees with heavy reliance on CDs and treasury securities. These rates are now the lowest in more than twenty years! If investors keep depending on these sources, they may continue to find their income declining.
The Muni-Bond Alternative
Here’s a possibly way to increase your tax-sheltered income by using the health-adjusted “Single Premium Immediate Annuity. ” Let’s take a look at the hypothetical case of Mr. Jones, age 70 with a $500,000 portfolio of municipal bonds, earning 5% tax free.
The Immediate Annuity- Old Investment Revamped for Modern Times
The word “annuity” brings to mind different meanings for many investors. That’s because there are different types of annuities designed for different purposes. The oldest of these is the immediate annuity, long used to generate a lifetime retirement income. The structure is well known as follows.
Real Estate- A Poor Cash Flow Investment
Rental property has always been a popular investment because of its appreciation potential and leverage. But in many parts of the country, it’s a lousy cash flow investment. Take a look at this example. Say you own a rental home with a $250,000 value, free of debt. You receive rent of $1200 per month.
It Used to Be Bonds For Income, But Take a Look at This Idea
Historically, if you desired income, you purchased income investments such as bonds or preferred shares. However, the data suggests that stocks may be a better source of income. Although most stocks do not have very significant dividends (the average dividend on the S&P 500 stands at 1. 28%), their appreciation, over time, can be used as a substantial source of income.
Insured CDs at 8.5%?
How can you get such high rates? They’re available to astute investors who know how to get the highest yields. First, let me explain that these CDs are issued by banks and have the same protection as any CD. They are covered by the FDIC up to $100,000 per depositor. But the bank is willing to pay a higher rate because the bank gets more flexibility.
