Tax Efficient Financial Strategies
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Tax Efficient Financial Planning
Astute financial planning in the current economic climate is critical. While we cannot control the ebbs and flows of either the market or the decisions of the government that affect one's personal finances, we can attempt to grow and preserve wealth through tax efficient financial planning. There are solid vehicles available, if utilized correctly, can successfully minimize income, capital gains and estate taxes for our clients. Below provides detailed information on vehicles available to provide minimal tax exposure.
Income Tax Minimization
Deferred Variable Annuities
Using this method clients not only are able to minimize their incomes taxes, but they this vehicle also provides asset protection.
401K or other Qualified Retirement Plan
Contributions to a 401k or a similar retirement plan are tax-deferred and not-taxable until withdrawal. Contributions help to lower an individual's AGI thereby lowering their income taxes or even lowering their tax bracket all together.
Limited Liability Company
Set up a Limited Liability Company (LLC) to create income outside of W2 income. Within the LLC exist opportunities for tax write-offs such as entertainment, utilities and travel.
Capital Gains Tax (CGT) Minimization
Invest in IRA's and 401K's
Buying and selling within these two types of accounts do not trigger the capital gains tax as investments if bought and sold outside of an IRA, 401K or other qualified pension plan would. Owning investments outside of these structures that trade often will trigger the Capital Gains Tax, moving these investments into an IRA or 401K would help to alleviate the CGT burden.
Index Funds
Index funds trade less than managed mutual funds, meaning that index funds have a lower rate of capital gains taxes. Using Index Funds in lieu…
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