December 20th, 2015

TAX TIP OF THE DAY... pay ZERO tax on capital gains!

A special rule allows long-term capital gains from investments to be taxed at ZERO %.  The catch is that your 2015 taxable income must be under $37,450 for single filers and $74,900 for married filers.   

Strategy 1:  In a year that you expect capital gains... if possible, keep your taxable income under the threshholds.  Use 401k's, IRA deductions, flexible spending accounts, deferred wage techniques and business losses to decrease income to qualifying levels.    

Strategy 2:  In a year that you expect your income to be unusually low...  use gain harvesting techniques to force long-term capital gains.  If desired, you can immediately buy back the same investments.  

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If you need any help... www.baboiancpa.com