The control, timing and reduction of income tax is a hallmark of genuine financial planning. Listed below are a few of the commonly used strategies here at Guidance Financial to maximize the capital retention and accumulation of your financial resources. It is imperative to consider the impact of each of these techniques within the scope of the other related components of your overall plan. That is why receiving the help of financial professionals is so important. We are available to assist you with these and many other valuable tax planning techniques.
Income Splitting–permanent and temporary asset transfers to minor children, college bound, and other trusts or entities with a lower tax bracket than your own personal bracket.
Family members on your payroll–earned income can be taxed at their tax bracket when it is lower than yours.
Qualified Savings Plans–-maximizing the amount of tax deductible savings for yourself and your family members is an often under utilized or overlooked area within one’s affairs. Often existing plans are substandard in terms of their structure and/or performance.
Tax Deferral–“Never pay taxes on money you don’t use” is an axiom many have found to be successful. If you have personal savings or investments generating too much taxable income perhaps you should consider tax deferred investments.
Tax Free Investing–Current law allows certain types of bonds and life insurance products to generate income which can be received tax free.
Tax Free Exchanges–Depreciated real estate and even annuity and insurance contracts can be stepped up into more attractive investment programs without any taxation when done properly.
Tax Deductions–There are a host of strategies and techniques aimed at generating tax deductions to offset your taxable income and thereby reduce your income tax. They include Family Foundations and Charitable Remainder Trusts, as well as certain Congressionally sanctioned investment tax incentives.
Lump Sum Distributions/IRA Rollovers. When you have worked hard all your life accumulating a retirement nest egg it is extremely important that you avoid potential pitfalls when you retire or change employers. Many people fail to realize all the tax and income options available to them and otherwise miss out on excellent options to enhance the impact of their 401k or IRA rollovers.