Understanding the Net Investment Income Tax

Brian SingletonBlog, Watch Your Wallet

While the Net Investment Income Tax (NIIT) tends to affect wealthier individuals most often, in certain circumstances, it can also affect moderate-income taxpayers whose income increases significantly in a given tax year. Here’s what you need to know. What is the Net Investment Income Tax? The Net Investment Income Tax (NIIT) is a 3.8 percent tax on certain net investment income of individuals, estates, and trusts with income above statutory threshold amounts referred to as modified adjusted gross income or … Read More

Leaving a Business: Which Exit Plan is Best?

Brian SingletonBlog, Watch Your Wallet

Selecting your business successor is a fundamental objective of planning an exit strategy and requires a careful assessment of what you want from the sale of your business and who can best give it to you. There are four ways to leave your business: transfer ownership to family members, Employee Stock Option Plan (ESOP), sale to a third party, and liquidation. The more you understand about each one, the better the chance is that you will leave your business on … Read More

Defer Capital Gains using 1031 Like-Kind Exchanges

Brian SingletonBlog, Watch Your Wallet

If you’re a savvy investor, you probably know that you must generally report as income any mutual fund distributions whether you reinvest them or exchange shares in one fund for shares of another. In other words, you must report and pay any capital gains tax owed. But if real estate’s your game, did you know that it’s possible to defer capital gains by taking advantage of a tax break that allows you to swap investment property on a tax-deferred basis? … Read More

Is Your Gift Taxable?

Brian SingletonBlog, Watch Your Wallet

If you gave money or property to someone as a gift, you may owe federal gift tax. Many gifts are not subject to the gift tax, but there are exceptions. Here are eight tips you can use to figure out whether your gift is taxable. 1. Most gifts are not subject to the gift tax. For example, there is usually no tax if you make a gift to your spouse or to a charity. If you make a gift to … Read More

Tax Rules for Children with Investment Income

Brian SingletonBlog, Watch Your Wallet

Children who receive investment income are subject to special tax rules that affect how parents must report a child’s investment income. Some parents can include their child’s investment income on their tax return while other children may have to file their own tax return. If a child cannot file his or her own tax return for any reason, such as age, the child’s parent or guardian is responsible for filing a return on the child’s behalf. Here’s what you need … Read More

Tax Tips for Individuals Selling Their Home

Brian SingletonBlog, Watch Your Wallet

If you sell your home and make a profit, do you know that the gain may not be taxable? That’s just one key tax rule that you should know. Here are ten facts to keep in mind if you sell your home this year. 1. If you have a capital gain on the sale of your home, you may be able to exclude your gain from tax. This rule may apply if you owned and used it as your main … Read More

Four Things to Know about Net Investment Tax

Brian SingletonBlog, Watch Your Wallet

Certain taxpayers may be subject to the Net Investment Income Tax, which went into effect last year, in 2013. You may owe this tax if you have income from investments and your income for the year is more than certain limits. Here are four things that you should know about this tax: 1. Net Investment Income Tax. The law requires a tax of 3.8 percent on the lesser of either your net investment income or the amount by which your … Read More

Year-End Tax Planning for Individuals

Brian SingletonBlog, Watch Your Wallet

Once again, tax planning for the year ahead presents more challenges than usual, this time due to the numerous tax extenders that expired at the end of 2013. These tax extenders, which include nonbusiness energy credits and the sales tax deduction that allows taxpayers to deduct state and local general sales taxes instead of state and local income taxes, may or may not be reauthorized by Congress and made retroactive to the beginning of the year. More significant however, is … Read More

Tax Rules for Children with Investment Income

Brian SingletonBlog, Watch Your Wallet

Children who receive investment income are subject to special tax rules that affect how parents must report a child’s investment income. Some parents can include their child’s investment income on their tax return, while other children may have to file their own tax return. If a child cannot file his or her own tax return for any reason, such as age, the child’s parent or guardian is responsible for filing a return on the child’s behalf. Here’s what you need … Read More

Leaving a Business: Which Exit Plan is Best?

Brian SingletonBlog, Watch Your Wallet

Selecting your business successor is a fundamental objective of planning an exit strategy and requires a careful assessment of what you want from the sale of your business and who can best give it to you. There are only four ways to leave your business: transfer ownership to family members, Employee Stock Option Plan (ESOP), sale to a third party, and liquidation. The more you understand about each one, the better the chance is that you will leave your business … Read More