Dear Valued Client,
With 2010 in full swing I am sure everyone is happy to have survived and some have even prospered in 2009. 2010 has many of the challenges that affected us in 2009 still in existence. But times like these breed opportunities that have never occurred before. Let’s do our best to make this year much better.
There are things we need to do and remember to focus on going forward:
America was built on entrepreneurial spirit. In the years of the depression the world thought that America forgot how to grow. We are facing that now, but we got over it then as we will again. We will grow. We simply need to get through the excesses that have been created. We continually need to look for opportunities and take advantage of them. This troubled time is creating many opportunities. It is time to watch and be prepared to take action in these times.
If you are running your own business or the company you work for is experiencing challenges, set realistic financial goals for 2010, but then do your best to beat those goals. If you are experiencing a drop in revenue, plan for that to continue, but, do not accept it. Act to try to change it. This gives you a psychological boost. Comparing yourself to last year or the year before gives you the feeling that things are going wrong. By focusing your attention to the future and setting realistic sights will give you a boost when things get better. Also by beating your own expectations you are also able to focus on growth and improvement rather than on losses compared to the past. The stock market has been rising because companies are doing better than expected. They are beating expectations, they are not comparing this year to the results of last year. This same outlook can influence you as well. It makes you feel better if you do better than you expect, even if it means that you have lowered your expectations.
Remember too, that no matter how bad it gets, someday it will get better. These times make us better people, harder workers, and make us more able to withstand adversity.
I am a firm believer in reading motivational books, attending seminars, and watching videos. These give you focus on the future and the ability to work through problems. It is not necessary to spend thousands of dollars on a particular course, rather, there are some great books and courses available for purchase that are not that expensive.
Many of you have cash to invest. For those of you afraid to make investments, remember, that investment is the catalyst for growth. If we stop investing in new businesses and new projects, we will not see that growth again. Just make sure you know who you are investing with.
If you are using a financial planner, you could diversify by having more than one and seeing how they both do. They might have strengths in different areas. If you are going to invest in companies or friends, make sure that they have the expertise in their area to make their venture successful. Oftentimes it happens that someone goes out into a venture they have never had experience in before and they fail for that reason alone- and you do not want them to fail with your money.
This year brings many new tax laws as well. The biggest being the ability to convert your IRA to a Roth IRA. That may be a great option for many of you as it may save you taxes in the future. Please let us know if this is something you would like us to look into for you and we can discuss this after tax season.
Above don’t forget to focus on the New Year with optimism. This optimism should bring more opportunities to all of us.
Here is wishing you a wonderful 2010!
Sincerely,
Todd Baldwin, CPA
Make the Most of New Tax Incentives with Year-End Planning |
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The end of the year has historically been the time for tax planning and making strategic year-end adjustments to reduce your tax bite. 2008 adds a whole new meaning to year-end tax planning. Because of the downturn in the economy, falling home prices, failing financial institutions and the huge losses on Wall Street, Congress has provided a number of tax incentives in an effort to get the economy back on track. The following articles include details about the most significant changes and those that require action by year's end.
Year-End Tax Tips and Planning Strategies
Year-End Tax Strategies for Stock Investors
Tax-Free IRA to Charity Distribution Reinstated
First-Time Homebuyer Credit
Summary of Economic Stability Legislation Tax Changes
Almost everyone will benefit in one way or another from at least one of the many tax changes implemented by Congress. However, taxpayers who have one or more of the following conditions apply to them will probably benefit the most from some year-end tax planning.
• Large investment losses
• Home foreclosed upon or anticipating foreclosure
• Forgiven debt
• Over age 70½ and regularly contributing substantial amounts to charity
• Small business owners
• Disaster losses
• Abnormally high or low incomes for the year
• In the process of or planning for the installation of home energy-efficient or energy-generating improvements
• Substantial business losses
• Considering buying your first home
If you would like a year-end tax tune-up or need some multi-year strategizing, we encourage you to call for an appointment soon. As we get closer to the end of the year, there will be less time to implement strategies that could provide you with significant tax savings on your 2008 return.
Make the Most of New Tax Incentives with Year-End Planning |
|
The end of the year has historically been the time for tax planning and making strategic year-end adjustments to reduce your tax bite. 2008 adds a whole new meaning to year-end tax planning. Because of the downturn in the economy, falling home prices, failing financial institutions and the huge losses on Wall Street, Congress has provided a number of tax incentives in an effort to get the economy back on track. The following articles include details about the most significant changes and those that require action by year's end.
Year-End Tax Tips and Planning Strategies
Year-End Tax Strategies for Stock Investors
Tax-Free IRA to Charity Distribution Reinstated
First-Time Homebuyer Credit
Summary of Economic Stability Legislation Tax Changes
Almost everyone will benefit in one way or another from at least one of the many tax changes implemented by Congress. However, taxpayers who have one or more of the following conditions apply to them will probably benefit the most from some year-end tax planning.
• Large investment losses
• Home foreclosed upon or anticipating foreclosure
• Forgiven debt
• Over age 70½ and regularly contributing substantial amounts to charity
• Small business owners
• Disaster losses
• Abnormally high or low incomes for the year
• In the process of or planning for the installation of home energy-efficient or energy-generating improvements
• Substantial business losses
• Considering buying your first home
If you would like a year-end tax tune-up or need some multi-year strategizing, we encourage you to call for an appointment soon. As we get closer to the end of the year, there will be less time to implement strategies that could provide you with significant tax savings on your 2008 return.
Deduction Tips for Contributors to Haiti Relief Effort |
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Haiti Contributions Deductible on 2009 Return - Congress has passed a bill (HR 4462) to permit taxpayers contributing to Haitian relief charities to elect to treat contributions made after Jan. 11, 2010, and before Mar. 1, 2010, as if the contributions had been made on Dec. 31, 2009. If the election is made, Haiti relief donations would be deductible on the 2009 return, not the 2010 return.
(Read More)
Direct Deposit Puts Your Money in Your Pocket...Faster |
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Don’t wait around for a paper check. Have your federal tax and state (if applicable) refund deposited directly into your bank account. Choosing direct deposit is a secure and convenient way to get your money in your pocket faster.
(Read More)
A frequent question asked is whether or not an individual needs to file a tax return. There are two issues associated with this question.
(Read More)
A Little Help for Your Friends |
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In these troubling financial times, many individuals are struggling to do their own taxes. Some need guidance with their tax and financial issues, while others would like to take advantage of the vast number of new tax benefits available in 2010 and subsequent years.
(Read More)
What's Best…Tax-Free or Taxable Interest Income? |
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A frequent tax strategy question is whether it is better to invest for tax-free or taxable interest. Generally, taxable interest will provide the greater return, but this may not hold true after taking into account taxes on the income. Therefore, the question is really which provides the greater "after-tax" return.
(Read More)
Tax Breaks for Charity Volunteers |
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If you volunteer your time for a charity, you may qualify for some tax breaks. Although no tax deduction is allowed for the value of services performed for a charity, there are deductions permitted for out-of-pocket costs incurred while performing the services.
(Read More)
Little-Known - But Important - Credit Card Rules for Merchants |
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Businesses that accept credit and debit cards must comply with privacy laws that aim to protect customer identity. There are regulations that even the most seasoned of merchants aren't always aware of. It's important for merchants, as well as consumers, to be aware of these little-known credit card rules to protect themselves and their information.
(Read More)
Owner-Only Businesses Should Consider a Solo 401(k) Plan |
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It goes by many names: Solo 401(k), Mini 401(k) and single-participant 401(k). We will use Solo 401(k) in this article to describe probably the best type of pension plan for owner-only businesses. It provides for larger contributions, including a Roth option for a portion of the contribution, and the ability to borrow funds from the plan at reasonable rates.
(Read More)
Are You Supporting Your Parents? |
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If you are helping support your parents, you may be having difficulty showing over half of the support for both, thus failing to qualify for the dependency exemptions (and for the beneficial head of household filing status if you are a single taxpayer).
(Read More)
