2010 Tax Planning Seminar. Presented by. Your Firm Name. The clock is ticking on savings …. Tax Rate Forecast. Tax Credits and Deductions. Credits: reduce tax dollar for dollar Deductions: lower your taxable income. 2010 Child Tax Credit $1,000 per child. Education Credits.
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Credits: reduce tax dollar for dollar
Deductions: lower your taxable income
Hope Scholarship Credit
(American Opportunity Tax Credit) = $2,500 maximum
Lifetime Learning Credit = $2,000 maximum
A credit for wage earners and the self-employed
Under Age 50: $16,500
Additional “Catch-Up” for those Age 50 and Older: $5,500
Income limits on conversions have
been eliminated in 2010.
You will be taxed on the conversion amount.
You will not owe a penalty
IRA savings can be used without penalty for qualified college expenses or to help pay for your first home.
Gain Tax Net Cash
11 months $50,000 $17,500 $32,500
12 months $40,000 $ 6,000 $34,000
Real estate depreciation recapture 25%
(without further reform)
Offset gains in your portfolio with losses at the end of the tax year.
Ordinary income rates 10% – 35%
Dividend rates 0% – 15%
Rates apply for both regular tax and AMT.
15% dividends also cannot offset capital losses.
Hold stock earning dividends taxed at 15% outside of retirement accounts
Focus on Total Return
Applies to children under age 19, or age 24 for full-time students.
Eligibility expanded through 2010
Work Opportunity Tax Credit (WOTC)
Expense allowance $250,000
Phaseout threshold $800,000
Make large purchases before 2011
Cost Segregation Nets $$$
Shorter Lives = Quicker Write-Offs
Reconsider Tax-Deferral Techniques
Is it time to switch to a pass-through entity?
We can help you monitor changing tax laws and update your strategies accordingly.