Investments

Copyright 2006 Kristine McKinley

Bank Of America Investment How many times have you done your taxes, and a week or a month later realized you forgot a deduction? The tax law is very complicated, so it's easy to miss a deduction or two. In my experience, these are the top 5 missed deductions.

Health Savings Accounts are available with qualified high deductible health plans, like the One Deductible plan. 1 Assurant Health and its legal entities are not engaged in rendering tax, investment or legal advice. Federal and state tax regulations are subject to change. If tax, investment or legal advice is required, seek the services of a licensed professional. 2 Your rate may vary. Many states allow for state tax deductions on HSAs.

Investment Opportunity 1. Non-Cash Donations

Tax Help at Complete Tax. Your source for tax deductions, irs tax help, child tax credits and tax credits

Banc Of America Investment Did you clean out your closets this year? Chances are you donated those items to Goodwill or a similar non-profit organization. The value of donated items (clothing, furniture, etc.) is deductible. You will need to get a written receipt and assign a value to these items, but the tax savings are worth the effort.

The taxes that are withheld from paychecks amount to about 25% of your gross pay (including federal tax, state tax, social security tax and medicare tax). But these taxes that are withheld could be working for you as investments if you employ what I call the ultimate tax strategy. This tax strategy consists of how you plan to pay no taxes just like all of the large corporations. Large businesses have teams of accountants and lawyers going over the tax code to make maximum use of legitimate deductions.

Banking Investment 2. Points on Refinancing

Claiming Tax Credits Besides taking care to claim all the tax deductions that you can, you can minimize your income tax bill by claiming all the tax credits available to you. When they're available, tax credits are generally better for you than deductions would be, because credits are subtracted directly from your tax bill. Deductions, in contrast, are subtracted from the income on which your tax bill is based.

Investment Solution Strategic With interest rates so low the past few years, there have been a record-number of houses refinanced. If you refinanced, you may have paid points to get a lower interest rate. These points are deductible over the life of the new loan. In addition, if you incurred points on an old refinancing, any unamortized points are deductible in the year of the new refinancing.

In this section of the Guide, we' related tax deductions, including home office tax deduction and home improvement tax deductions. We'll also discuss how to handle the purchase or sale of your principal residence. Let our home office tax deductions and more work to your advantage.

Investment Banking Services 3. Educator Expenses

Bank Investment If you're a qualified educator (teacher, aide, instructor or principal), you can deduct up to $250 for materials you bought for the classroom. Qualified expenses include books, supplies, and computer equipment. This law is set to expire in 2006, so take advantage of it now if you qualify.

Alternative Investment 4. Investment and Tax Expenses

Online Investment Services Expenses for tax planning and investment advice are deductible as a miscellaneous deduction, subject to the 2% Adjusted Gross Income (AGI) limitation. Expenses that qualify include tax preparation fees, safe deposit box fees, fees paid to investment advisors, legal and accounting fees related to tax planning, broker and IRA fees paid directly, investment publications, and more. Many people assume that they won't have enough miscellaneous expenses to exceed the 2% AGI floor, but all of these expenses combined can be substantial, especially if you have unreimbursed employee expenses to add to these expenses.

Accompany Essential Investment 5. College Savings or 529 Plan Contributions

Investment Company Depending on which state you live in, contributions to 529 college savings plans may be deductible on your state income tax return. Because this deduction is only available on the state return (no deduction available on your federal return for 529 contributions), many people fail to include this deduction on their state tax return.

Investment Management Solution
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Investment Management Services Kristine A. McKinley, CFP, CPA, and founder of Beacon Financial Advisors, teaches individuals and families how to invest and plan for retirement, college, and other financial goals. Kristine offers financial and tax planning on an hourly, fee-only basis.
To sign up for free financial planning tips, worksheets, checklists and more, visit http://www.beacon-advisor.com .

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