5 Common Causes of Prevalent Tax Mistakes
March 18, 2014 --
5 Common Causes of Prevalent Tax Mistakes
Nearly Half of Us Believe We Overpay, Says Veteran Investment Advisor
March 18, 2014 (www.investorideas.com newswire) Whether you've filed for an extension on your taxes this year, or have waited until the last minute to complete paperwork, or want a better strategy for the future, chances are you could be doing a better job throughout the year to save on income taxes, says seasoned investment advisor Paul Taylor, a member of the National Ethics Bureau.
Forty-nine percent of Americans think they personally pay more than their fair share in taxes, according to 2013 Rasmussen reports.
"Come tax time, many of the other half could be doing more to legally and strategically save money," says Taylor, an architect-turned-founder and owner of Capital Advisory Group & Tax Planners of Lake Norman and Capital Investment Advisors, Inc, (www.CapitalAdvGroup.com).
He cites mistakes that many taxpayers are liable to make now and in future years.
- Not knowing which tax deductions are available. Tax reform measures are enacted frequently by Congress, which makes it hard for U.S. taxpayers to know which deductions are currently available for maximizing savings. One of the most overlooked deductions is state and local sales taxes. Taxpayers may be able to take deductions for student-loan interest, out-of-pocket charitable contributions, moving expenses to take a first job, the child care tax credit, new points on home refinancing, health insurance premiums, home mortgage interest, tax-preparation services and contributions to a traditional IRA.
- Misunderstanding deduction value for medical expenses. The Affordable Care Act has altered the guidelines for tax-deductible medical expenses. Effective Jan. 1, 2013, the new policy increased the threshold for the itemized deduction for unreimbursed medical expenses from 7.5 percent of adjusted gross income to 10 percent of adjusted gross income for regular tax purposes. The increase is waived for individuals age 65 and older for tax years 2013 through 2016.
- Confusing when taxes must be paid on IRA and employer-sponsored retirement funds. Traditional IRAs and most employer-sponsored retirement plans are tax-deferred accounts, which mean they are typically funded with pre-tax or tax-deductible dollars. As a result, taxes are not payable until funds are withdrawn. Exceptions are the Roth IRA and the Roth 401(k) and Roth 403(b). Roth accounts are funded with after-tax dollars. That's why qualified distributions after age 59 and the five-year holding requirement has been met are free of federal income tax.
- Overlooking tax-advantaged investments. Tax-advantaged investments can include real estate partnerships, oil and gas partnerships and suitability, which refers to how appropriate an investment may or may not be to an investor. Two of the most common types of real estate partnerships, for example, are low-income housing and historic rehabilitation. The federal government grants tax credits to those who construct or rehabilitate low-income housing or who invest in the rehabilitation or preservation of historic structures.
- Uncertainty when accounting for gift taxes. The federal gift tax applies to gifts of property or money while the donor is living. The federal estate tax, on the other hand, applies to property conveyed to others, with the exception of a spouse, after a person's death. There are several exceptions to gift taxes, including gifts of tuition or medical expenses that you pay directly to a medical or educational institution for someone else, gifts to a spouse who is a U.S. citizen, gifts to a qualified charitable organization and gifts to a political organization.
About Paul Taylor
Paul Taylor is the founder and owner of Capital Advisory Group & Tax Planners of Lake Norman and Capital Investment Advisors, Inc. Taylor, a fully licensed investment advisor, has more than 20 years of experience in the industry and is committed to providing personalized service to those he serves. Since 2007, he has been a member of the National Ethics Bureau, which acknowledges individuals who prove they are committed to upholding the highest ethical standards in their practices.
If you would like to run the above article, please feel free to do so. I am able to provide images if you would like some to accompany it. If you're interested in interviewing Paul Taylor or having him write an exclusive article for you, let me know and I'll gladly work out details.
National Print Campaign Manager
News and Experts
3748 Turman Loop #101
Wesley Chapel, FL 33544
Tel: 727-443-7115, Extension 207
This news is published on the Investorideas.com Newswire and its syndicated partner network
Get Free investor news and stock alerts: Sign up here
Published at the Investorideas.com Newswire - Big ideas for Global Investors
Disclaimer/ Disclosure:The Investorideas.com newswire is a third party publisher of news and research as well as creates original content as a news source. Original content created by investorideas is protected by copyright laws other than syndication rights. Investorideas is a news source on Google news and Linkedintoday plus hundreds of syndication partners. Our site does not make recommendations for purchases or sale of stocks or products. Nothing on our sites should be construed as an offer or solicitation to buy or sell products or securities. All investment involves risk and possible loss of investment. This site is currently compensated by featured companies, news submissions, content marketing and online advertising. Contact each company directly for press release questions. Disclosure is posted on each release if required but otherwise the news was not compensated for and is published for the sole interest of our readers. More disclaimer info: http://www.investorideas.com/About/Disclaimer.asp
BC Residents and Investor Disclaimer : Effective September 15 2008 - all BC investors should review all OTC and Pink sheet listed companies for adherence in new disclosure filings and filing appropriate documents with Sedar. Read for more info: http://www.bcsc.bc.ca/release.aspx?id=6894. Global investors must adhere to regulations of each country.
Read more News