In 1789, Benjamin Franklin said, “Nothing is certain except death and taxes.” The good news is that there are some things we can do, such as healthy eating and exercise, to attempt to defer the first event, and there are actually several steps we can take to defer—as well as reduce—our taxes.
I hate thinking about taxes, but if you’ll allow me another Franklin quote, “If you fail to plan, you are planning to fail,” is more critical today than ever—especially in light of the proposed tax hikes awaiting us in 2022.
But first, let’s look at the following graph from Fidelity. I first introduced it last fall, and here is the updated version.
These are the results of Fidelity’s research for the past 20 years on how you can save on your investment taxes by tax-loss harvesting, managing capital gains, managing distributions and tax-smart withdrawals.
As you can see, the earlier your planning begins, the faster your savings accumulate. But it’s also obvious that, even if you started just in the past few years, you would have still saved on your taxes. So, the lesson is—it’s never too late to begin some tax-saving strategies!
Read the feature article in this month’s magazine now to get everything you need to know about saving money on your taxes, including a summary of 2021 tax changes that might be affecting you now:
- 2021 Tax Rates by Filing Status and Taxable Income
- Tax Rates on Capital Gains and Dividends for 2021
- What to do About Required Minimum Distributions in 2021
- The Above-the-Line Charitable Contribution Deduction—Explained for 2021!
- Increased Limit for Cash Contributions in 2021
- 2021 Rules for Net Operating Losses and Excess Business Losses
- What Counts as a Qualified Medical Expense in 2021?
- 2021’s Increase for the Child Tax Credit
- How to Handle Social Security Taxes that were Deferred
In addition to 2021’s tax changes, you should know about other ways to maximize your income and minimize your taxes—all covered in this article, including:
- How to Defer Your Income—Legally!
- The Right Way to Accelerate Some Tax Deductions
- Beware: How to Avoid the Alternative Minimum Tax (it’s not just for the wealthy anymore!)
- When to Itemize your Deductions
- Dump the Losers in Your Investment Portfolio to Cut Your Losses
- How Much Should You Contribute to Your Retirement Account?
- For the Self-Employed: Check Out a Simplified Employee Pension Plan
- Avoid the Kiddie Tax (officially called the “Tax On A Child’s Investment and Other Unearned Income”)
- Keep an Eye on Your Flexible Spending Accounts—Remember, it’s Use it or Lose it!
- How to Use Your Estate Tax Exemption Now—Without Later Penalty
- Consider a 529 Plan for Your Child’s Education Expenses
- What is the Current Cash Gift Limit to Other Individuals?
- How to Avoid Penalties for Underpayment of Federal Income Tax
And when you read this article in the October 2021 issue of our Magazine, you get details on proposed 2022 tax changes that might affect you—here’s how:
- What is the new proposed top marginal income tax rate for 2022—and to what level of taxable income would it apply?
- Planned increase in tax rates for long term capital gains and dividends—how the current proposal could change how much you pay.
- How capital gains taxes on property transfers might change.
- Proposed changes to the self-employment tax and the net investment income tax.
- Tax-rate changes proposed for “C” corporations—would rise from 21% to 28% in 2022, if enacted.
- How taxes might change for large corporations with more than $2 billion in come.
- Planned big changes to employer-provided childcare tax credits.
- NEW: the Neighborhood Homes Investment Tax Credit would support investing in neighborhoods where homes are in poor condition of have low property values.
- Proposed new Clean Energy Tax Credits, including for electricity transmission investments and heavy- and medium-duty zero emission vehicles.
- Possible changes to gifts and transfers at death—how it might affect you or your heirs.
- Planned stricter tax enforcement by the IRS, to ensure “the wealthy pay what they owe.”
All these proposals are still pending, as part of Joe Biden’s proposed American Families Plan for 2022—while we don’t yet know how much, if any, of these proposed new taxes will actually go into effect, it never hurts to plan ahead to being to minimize any hurt. And you’ll find out how to act when you read this article now!
In this feature article in the October 2021 issue of our Magazine, you’ll learn all about tax and investing strategies that can help you make and save money. Read this article now, and get everything else in this issue of our magazine, too, including:
- Getting Ahead of the IRS: Year-end strategies to save on taxes and what to expect in 2022.
- Looking for Value Plays? Try Electric Truck Company Stocks: Electric cars are growing in popularity and it’s only a matter of time before electric trucks have their moment in the sun. This turnaround candidate has struggled but has lots of upside potential—find out about it now!
- 8 Things to Know About Moving Averages: Moving averages can be a powerful tool in a trader’s toolbox for identifying stock trends and measuring supply and demand. These tips can help you implement them in your own investing.
- The Best Play on EV Growth Doesn’t Sell Electric Cars: Electric Vehicle (EV) growth is hard to ignore; and with all the major automakers expanding their EV fleets, there’s a huge opportunity for investment in a company that helps support all of them. Discover why this stock is worthy of your consideration!
- Hey, Want a Beer (Stock)? Invest in these Two Packaging Companies: Beer and hard-seltzer trends come and go but the packaging (mostly) remains the same and these two companies are poised to profit, regardless of beverage trends. Read all about these two stocks now!
- The Easiest Way to Profit in Sideways Markets: Snoozing is a perfect way to spend a summer afternoon at the beach, but lazy summer stocks can slow your portfolio growth. Adding a covered option strategy is a great way to wake up your returns. Find out how to do it in this article now!
- 3 Social Media Stocks with Momentum: Regardless of how you feel about social media, it’s growing rapidly and shows no signs of slowing down. These three stocks are showing serious momentum—check them out now!
- 2 High-Paying Dividend Stocks Immune to the Yield Curve: The yield curve is a headwind for lenders, but persistent low interest rates mean investors can get these two stocks at a discount. Read about them now!
- This Energy Source isn’t Going Away; Here are 3 Ways to Profit from It: Nuclear energy offers better reliability than most renewables and a lower environmental impact than coal- or gas-fired plants. It’s not going away and here are three ways to profit from it.
- How a New SEC Ruling Could Impact Micro-Cap Investors: A new upcoming SEC rule change could have a significant impact on liquidity of micro-cap “dark stocks.” What will that mean for investors? Get the answer in this article now.
- Easy Ways to Combat Our Fundamental Investing Flaw: Having a disciplined investment plan can help you avoid the pitfalls of excess fear in the market—as well as common mental errors that investors of all persuasions make from time to time. Avoid these investing flaws now!
This latest issue of the Federation’s Magazine is ready for you to access now, to discover how to save on taxes and prepare for 2022… and much more. Read it now!
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