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From category archives: Wealth Management Newsletter


Ten Year-End Tax Tips for 2017

Here are 10 things to consider as you weigh potential tax moves between now and the end of the year. 1. Set aside time to plan Effective planning requires that you have a good understanding of your current tax situation, as well as a reasonable estimate of how your circumstances might change next year. There's a real opportunity for tax savings if you'll be paying taxes at a lower rate in one year than in the other. However, the window for most tax-saving moves closes on December 31, so don't procrastinate. 2. Defer income to next year Consider opportunities to defer income to 2018, particularly if you think you may be in a lower tax bracket then. For example, you may be able to defer a year-end bonus or delay the collection of business debts, rents, and payments for services. Doing so may enable you to postpone payment of tax on the income until next year. 3. Accelerate deductions You might also look for opportunities to accelerate deductions into the current tax year. If you it ...

Donating Appreciated Securities for Charity

With the global stock markets near or at all-time highs, we thought it might be appropriate to re-visit this topic. The following is a reprint from last year’s newsletter. Tax deductions are a major benefit of charitable giving. Before cashing out of a profitable investment, consider making efficient use of its full value by donating it directly to charity. Charitable giving provides donors with tax relief every tax season in the form of deductions. In an effort to encourage positive social action, the IRS provides incentives for all kinds of charitable contributions, from monetary donations to used cars. You can even donate your appreciated securities (stocks, bonds, mutual funds, etc. that have risen in value) to the charity of your choice. Long-term appreciated securities are the most common non-cash donations, and they can be the best way for donors to give more to their chosen charities. The tax advantages to donating stocks are such that both the donor and the charity benefit. What are the b ...

Strategies for Trump’s Potential Tax Plan in 2017

Just as the characters in Game of Thrones unequivocally know Winter is coming, we also know Change is coming with President Trump. During his speech to Congress on February 28th very little details were revealed of his new tax plan. According to Mick Mulvaney he expects a full budget proposal will not come until May. Summarized below is a review of President Trump’s proposals in the past as we speculate what changes might come for our tax system. Note we do not discuss the House GOP’s blueprint which differs from Trump. Personal Income Tax Trump wants to consolidate and simplify the current tax brackets. Whether the impact of the proposed changes will be good, bad or ugly will depend on your present tax situation. Notice in the table below the capital gains rate may actually increase for many taxpayers from 15% to 20%. Those in the higher end of the 28% bracket will see increased tax rates for both income and capital gains. Other notable proposals would be to repeal the Alternative Minimum ...

Which State Will You Live in Retirement?

“In this world nothing can be said to be certain, except death and taxes.” – Ben Franklin. This old adage is as relevant today as it was back in 1789. There are essentially two types of taxes in the United States: living taxes and death taxes. If you are thinking of moving to another state in retirement, there are generally three financial questions to consider before you move: What is the state income tax? How much does it cost to live there? Will my estate get taxed when I die? State Income Tax There are currently seven states that do not tax the income of its residents (see map below). However, the state tax system is more complicated than that. For example, Tennessee only taxes interest and dividend income. Certain cities charge a separate tax from the state. Such as a New York City resident who may pay an additional 3.876%. Some states exclude pension income from taxation. When considering where to live in retirement, it is important to consider what type of income you will receive ...

Last Minute Change May Have Left Some Taxpayers in a Bind

On December 23, 2016 the IRS quietly issued a notice that may have left some taxpayers counting on a charitable deduction in a pickle. The IRS deemed syndicated conservation easement transactions as a “listed transaction”. Which doesn’t sound so bad but a “listed transaction” is essentially IRS terminology for tax avoidance strategy. What is a Conservation Easement? At a very high level, the basic mechanics of the strategy starts when a landowner voluntarily places restrictions on the land (or a portion of the land) and then donates that right to a qualified organization. The idea is to conserve the land, typically from development, while the landowner can continue to own and use the property. In exchange for contributing to the greater good, the landowner is allowed a significant income tax deduction. The catch is the easement stays with the property in perpetuity. So if the property is ever sold this could reduce the sale price. Conservation easements have been around sin ...

Tax Updates for 2017

Every year in the fall, the Internal Revenue Service announces the annual inflation adjustments for the next year. For 2017, the biggest news is there is very little change. Due to the low cost-of-living index, most of the figures did not meet the threshold to trigger an increase. Summarized below are a few highlights comparing 2016 and 2017:


The data contained in this article is for information purposes only and is not intended for legal, tax or accounting advice. The information was taken from sources we believe are reliable and may be subject to change.

2016 Year-End Planning Advice

Wealth Management There has been quite a bit of uncertainty created by the elections this year. It is important to keep an eye on any law changes that may impact you for federal and state tax. As we near the end of the year, take a moment in December to plan for your finances so you can start the New Year with peace of mind. If this seems too daunting to accomplish in the next month, we strongly suggest you work with a financial professional. Tax efficiency ◾ Income taxes: Estimate your 2016 tax bill so you won’t be caught off guard when you file your taxes next year. If you are estimated to get a large refund, then you may be withholding too much from your paycheck. This is essentially an interest-free loan to the government until next spring. On the other hand, if you owe more taxes than you have withheld, then keep enough saved for your tax liability next year. ◾ Investments: Holding actively managed mutual funds in a taxable account require some of your attention. Most active mutual fu ...

Philanthropy: Charitable Giving with Collectibles

A collection can be very special and unique to the individual. Passions can range from cars, wine, art, comic books and figurines. These works of “art” often evokes memories for the collector, or the family, and the legacy it leaves behind. Eventually, collectors need to plan for how they want to pass on their beloved collection. The first decision is whether the transfer will occur while the collector is alive or at passing. The next decision is if the collection will be gifted to a charitable organization or passed on to heirs. Each of these choices has its own consequences. For example, if a collector gifts a collectible to his/her children the positive impact is the asset is out the collector’s estate. However, the original basis carries over and no step-up in basis is received; the gift reduces the collector’s lifetime gift exemption. On the contrary if the collector waits and transfers the collectible to his/her children upon passing the positive impact is the basis step-up. The ...




All First Bank blog information and content is strictly informational. It is not intended to be specific investment, tax, or legal advice. If you need detailed financial, investment, or tax advice, please contact a First Bank qualified professional. Please note, First Bank occasionally shares third-party content we find to be relevant and helpful to our audiences.