Using Taxes to Your Advantage

May 4, 2022

What is Tax Planning?

  • Tax planning is the analysis of a financial situation or plan from a tax perspective.
  • It is the reduction of tax liability by the way of exemptions, deductions, and benefits.
  • The purpose is to ensure tax efficiency.

Types of Tax Planning:

  • Purpose Tax Planning- Planning taxes with a particular objective in mind.
  • Permissive Tax Planning- Tax planning that is under the framework of the law.
  • Long range and Short range Planning- Planning done at the start and at the end of the fiscal year respectively.

Tax Saving Strategies:

  • Manage standard deductions- flexible tax strategies allow investors to shift when tax rules change.
  • Consider bunching- craft a tax plan that bunches into a single tax year expenses that were previously deducted annually.
  • Keep an eye out for new opportunities- refresh tax strategies to take advantage of new incentives.
  • Update estate plans- estate tax planning should never be a "set it and forget it" process.
  • Believe in basis planning- use the much higher exemption amount to keep appreciated assets in their estates.
  • Pay medical and education costs directly- one way to increase the tax-free ceiling is to help pay the education and medical expenses for loved ones.
  • Use the rules to your advantage- tax plan around the rules that have been in the Internal Revenue Code for a long time.
  • Negotiate based on tax changes- knowing a change is coming is essential when negotiating the terms of an agreement that will carry forward into future tax years.

The goal:

  • Reduce taxes on your income to keep more of what you make.
  • Reduce taxes on your estate so your family keeps more of what you've made.
  • Reduce taxes on your gifts so you can give more.
  • Reduce taxes on your investments so you can grow wealth faster.
  • Reduce taxes on your retirement distributions so you can make the most of your retirement savings.
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2023 Webinar Line Up

We at Verus are still continuing to host educational and interactive webinars throughout the year so you can learn from the comfort of your home! Click to see the webinar links!

Strength in Houses

The extended strength of the US housing market prompted households to withdraw $82 billion of home equity in Q1, the largest amount in 15 years. Going forward, refinancing will likely be subdued as the average mortgage borrower has already locked in an interest rate over 200 bps below current rates. We believe that record-high levels of untapped home equity may add to the sizable savings buffer that households hold.‍

Your 2022 Half-Year Planning Checklist

As 2022 draws to a half, it’s time to begin organizing your finances for the second half of the year. To help you get started, we’ve compiled together a list of key planning topics to consider. Your Verus Financial Advisor can help you rebalance, review and reset your course, if necessary, for this year and beyond.

Where are we now in the market?

The market appears to be caught in a traditional growth scare if there is anything that is scaring the markets right now it's not just happening in US it's happening broadly as well. The roller coaster continues so we're seeing yields higher, and stocks lower and why that is happening we're actually going through a period of transition where the stimulus you know the sugar rush from stimulus is wearing off.

Estate Planning 101

A good estate plan helps ensure the right people will receive the right property at the right time. When you die, your assets are subject to a number of expenses that can significantly reduce the size of your estate left to your heirs. Proper estate planning can minimize these expenses and determine how the costs that remain will be paid.

Using Taxes to Your Advantage

Tax planning is the analysis of a financial situation or plan from a tax perspective. It is the reduction of tax liability by the way of exemptions, deductions, and benefits. The purpose is to ensure tax efficiency. Tax planning includes making financial and business decisions to minimize the incidence of tax.

Protecting Your Greatest Asset

To put it in simple terms, disability insurance is insurance for your income. It allows you to protect your most valuable asset, your income, in the event you become too hurt or sick to work. There are two options: Short-term and long-term. Analyze your existing coverage to find the plan that best fits your lifestyle! It can be more affordable than you think and the benefit can be used for different things such as medical expenses, household expenses, or help with household tasks. Most people protect their home, car, phone, and identity so why not protect your income.

Protect Your Loved Ones With Life Insurance

If you were to die unexpectedly, would your spouse have enough money to cover funeral expenses and daily living expenses? Would there be enough money to pay for everything your family relies on you for, if you were suddenly not around? Would your family have to move and change their lifestyle if you were to die prematurely? If your spouse were to outlive you by 10 or 20 years or more, would they be able to make ends meet? Life insurance pays cash to your loved ones after you die, allowing them to remain financially secure.

College is Right Around the Corner

Why Start Planning Now? A child that is born now will face tuition costs that are three to four times higher than what they are now. It is never too early to start planning for your child's future. There are many ways to save for college. Some you might have heard before, some you might not have. This article easily sums up different college saving plans that you can potentially think about using.

The Basics of Investments

What is Investing? Investing is the act of committing money or capital to an endeavor with the expectation of obtaining an additional income or profit. Making your money work for you maximizes your earning potential whether or not you receive a raise, decide to work overtime, or look for a higher-paying job. There are many ways you can invest which include putting money into stocks, bonds, mutual, real estate, or starting your own business. It does not matter which method you choose for investing your money, the goal is always to put your money to work so it earns you an additional income.

Why You Should Keep Investing Even When Markets Are Down

As investors during a decline in the market, it is difficult to remember why we decided to take the risk of investing. In its best days and its worst days, the stock market draws the most attention, but there is one surefire way to keep trading worth your time: Stick it out for the good and the bad. If you plan for the long-term, don't panic. Instead, here are 3 reasons to keep investing, even in the worst of times.

What does Fed rate hike mean for the market?

The big news today is that Chairman Jerome Powell and the Federal Reserves announcing a 25 basis point hike in interest rates. Let's see how this could potentially affect the market. If we take a look back at historical data, the S&P 500 has averaged a 3.7% growth, 12-months following the first rate hike of each cycle from 1971 to 2004. 24 months after the first hike, it has seen an average of 16.3% growth and averaged 31.0% after 36 months.

August Market Summary

GLOBAL EQUITIES: Q2 earnings data kept Delta variant concerns at bay, initially reversing the S&P 500’s mid-week decline. However, despite US Q2 GDP posting above its pre-pandemic peak, it came in lower-than expected, leading the S&P 500 to end the week lower by -0.35%. Meanwhile, Chinese stocks saw significant volatility as investors grappled with Beijing’s tighter financial regulations. The MSCI China Index ended the week lower at -6.06%. In the UK, a drag in the mining sector and variant concerns left the FTSE 100 up only 0.10%.

Mega Roth IRA: What It Is And How It Can Work For You!

Roth IRAs have been a popular topic as of late. For a long time, it was an unspoken secret used by retirement planners. However, the IRS released guidance that specifically addressed both backdoors Roth IRA conversions, and the so-called Mega Roth IRA. As a result, it has gained even more traction and interest.

Where Will Your Equity Profile Be in a Year?

The market is disengaged from financial fundamentals and all reality. Remember December 2018when the market fell 20% (over three months) over a “potential” China trade war? And remember the big rally in 2019 – and you’re saying to yourself “If only I had bought back then!” Surprise! You're getting a second chance!

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Explore the various services we employ to see how we can improve your money.

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Your plan is more than just money; it’s personalized for you. We are side-by-side with you every step of this process to guide and help you create a custom financial plan based on your specific goals.

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Imagine a retirement plan tailored for you. Everyone has a different money situation. That’s why you deserve realistic and personalized retirement plan to support your future.

Invest

For what matters most in your future. Saving for your goals and redirect your money away from companies with harmful products, policies, and practices.

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You are the most important resource to the people who depend on you. Our plans  designed to help you protect your loved ones whether it’s a child, an aging parent, or even a business partner and find clarity in next steps

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Investing in digital currency, made simple. Whether you are ready to invest a significant sum or want to start with a small amount, we offer a simple and secure solution. Brought to you by Gemini and Arbor Digital

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Businesses deserve the guidance of a professional who understands not only its needs, but also how the business can affect a person's personal financial situation and life goals.

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If you don’t invest in a better world for all, who will?
Our Environmental, Social, and Governance portfolios are built to tackle issues that disproportionately affect all, like gender inequality and climate change.

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You are your most important resource. Our executive coaching is designed to help you reinvent your career, create balance at work, and find clarity in next steps.

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