4 Strategies to Reduce Your Capital Gains Taxes in Monroe, LA
Writing an unnecessarily large personal check to the federal government for capital gains adds salt to the wound of arguably excessive taxation. Taxes certainly serve an essential purpose, yet there is a worthy argument that current capital gains taxes are somewhat punitive for prosperous individuals. Niswanger Law in Monroe, LA, is here to help you minimize your capital gains tax burden. Lean on our tax law attorney each tax season, and you will sleep soundly knowing you have done your part to fulfill your financial obligations without paying a penny more than necessary.
1. Start Planning Now
Time is of the essence when it comes to capital gain taxes. The timing of your investment transactions matters a great deal in the context of capital gains taxation. Consult with our tax attorney in Monroe, LA, and you will know precisely when the best time is to sell to minimize your capital gains taxes each April. We will detail your specific tax liabilities and the best tax harvesting strategies to reduce those burdens with timely transactions.
Niswanger Law assists in planning the timing of the sale of stocks, real estate, artwork, collectibles, and other forms of property that trigger capital gains taxes. Time the sale of such assets just right, and you might save thousands or even tens of thousands of dollars.
2. Make Prudent use of Retirement Accounts
The money you keep in taxable accounts is taxed continuously and when financial gains come to a realization. For example, a stock that increases in value and provides quarterly dividends spurs taxation at the time the stock is sold and when dividends are paid. After-tax contributions are made to a Roth IRA, yet you won’t pay taxes on investment income even if you withdraw the money in retirement. Our Monroe, LA tax attorneys know all the details and strategies for making the best use of these accounts to keep your money in your pocket instead of Uncle Sam’s.
3. Become a Real Estate Owner
Those who own real estate are eligible for upwards of a quarter-million dollars worth of gains on the property at the time of sale. However, the rules are a bit different for those who are not single filers. The ceiling doubles for those who are married and file a joint tax return. Gains more significant than such exclusions are taxed at the capital gains rate as long as the home is the taxpayer’s primary residence used for living in a minimum of two of the prior five years.
4. Mind Those Mutual Fund Distributions
Mutual fund investors must be aware that there is the potential to be subjected to harsh capital gains taxes every year. These funds amass capital gains across the year while moving in and out of stocks and other securities positions. In specific years, the mutual fund has considerable losses that help offset realized gains. However, capital gains are directed through shareholders in other years, meaning capital gains distributions. If your capital gains distributions are comparably high, it might be wise to move your money into a different fund to avoid the capital gain distribution.
Contact Niswanger Law for Tax Guidance
Countless hardworking Americans have attempted to navigate the capital gains tax maze on their own only to find it egregiously complex and frustrating. Do not make the same mistake when tax season rolls around. Entrust our capital gains tax experts to minimize your tax burden to the fullest. Reach out to us today to schedule a consultation. You can contact Niswanger Law in Monroe, LA by phone at 318.953.0071 or online through our contact form.