Tax Advantaged Investing
Whether planning for retirement, making an effort to reduce income taxes or maximizing current income, there are many excellent tax-deferred or tax-deductible investment options to consider. There are also many tax advantaged accounts from which your investment representative can choose, based on your goals. We'll work with you to develop a detailed strategy that will help you achieve your long-term financial goals, while minimizing your current tax liabilities.
Tax-Advantaged Accounts*
- IRA: An IRA (Individual Retirement Account) is a personal retirement fund. The earnings in a traditional IRA are not taxed until distribution and contributions may be tax-deductible under certain circumstances.
- Rollover IRA: This is an individual retirement account that allows you to move, or roll over, assets from a qualified retirement plan. Whether you are changing jobs, retiring, or receiving a distribution from your employer's retirement plan, you can benefit from the tax-deferred growth potential of a Rollover IRA.
- SEP IRAs: With A SEP-IRA (Simplified Employee Pension IRA) the employer, not the employee, makes the contributions. Generally, the SEP-IRA is designed for self-employed persons operating as sole proprietorships, partnerships or corporations.
- 401(k): With a 401(k) plan sponsored by an employer, employees can elect to invest a portion of their wages in a tax-deferred account. In addition, employers may contribute to a 401(k) plan through employer matching contributions or a profit sharing program.
- Qualified Retirement Plans: A qualified retirement plan is one that has been approved by the Internal Revenue Service and meets the requirements of the Internal Revenue Code. These plans receive tax advantages.
Tax-Advantaged Investment Options
- Tax-deferred Fixed Annuity:
A tax-deferred annuity is an investment product issued by an insurance company. Because annuities are accorded "tax-deferred" status, you do not pay taxes on the earnings credited until the earnings are withdrawn. With an annuity you can accumulate interest in three different ways: interest on the principal, interest on your earnings and interest on the money you would otherwise have paid in taxes.
- Tax-Managed Mutual Funds**: Tax-managed funds carefully consider how an investment will impact the shareholder's tax bill. A mutual fund's turnover rate, for example, can have a significant impact on an investor's after-tax return.
- Municipal Bonds: Municipal bonds generally are tax-exempt debt obligations of states, cities, towns, municipalities, municipal authorities and governmental entities. The interest earned is free of federal income taxes and also may be free of state or local income taxes if purchased by residents of the issuing state.
Related Topics
Investment Strategies - Secure your long-term financial future
Asset Allocation - Provides a hedge against risk
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Whether you're planning for retirement, funding a college education or protecting your assets, we can help.
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