It may surprise you how quickly you can accumulate a million dollars.
Suppose you have numerous itemized deductions such as mortgage interest, charitable contributions, etc. In that case, it may make sense to itemize your deductions instead of using the standard deduction for your tax filing status.
Tax-free investments such as municipal bonds have lower yields due to their tax-exempt status.
Did you withhold enough in taxes this past year?
It might surprise you how many days you would have to work to pay your estimated federal tax liability (including Social Security tax withholdings).
Taxes are unavoidable; without planning, the annual tax liability can be very uncertain.
Interest paid on debts incurred to invest (such as 'margin accounts') is generally deductible to the extent that it offsets investment income (such as interest, dividends, and short-term capital gains). Interest payments over investment income can be carried forward to offset future investment income.
Self-employment taxes are comprised of two parts: Social Security and Medicare. You will pay 6.2 percent, and your employer will pay Social Security taxes of 6.2 percent up to the annual limit. This limit changes each year with changes in the national average wage index. You each also pay Medicare taxes of 1.45 percent on all your wages - no limit. For example, if you are self-employed, your Social Security tax rate is 12.4 percent, and your Medicare tax is 2.9 percent on those same earnings amounts, but you can deduct the employer portion. You will pay an additional 0.9% Medicare tax if your annual income exceeds $200,000 for single filers, $250,000 for married filing jointly, and $125,000 for married filing separately. Use this calculator to estimate your self-employment taxes.
Federal taxes on your net capital gain(s) will vary depending on your marginal income tax bracket and the asset's holding period.
Investment vehicles are taxed differently. This calculator is intended to help compare a fully taxable investment to two tax advantaged situations.
Did you know that up to 85% of your Social Security Benefits may be subject to income tax? If this is the case, you may consider repositioning some of your other income to minimize how much of your Social Security Benefit may be taxed and maximize your retirement income sources.
Interest paid may or may not be tax-deductible depending on the type of interest paid.
Information presented on this website is not intended as tax or legal advice. You are encouraged to seek tax or legal advice from a qualified professional.
