I have an action item for you in a moment, but before I get there, allow me to explain…
You see, one of the projects toward which I devote my time during the summer, is expanding my financial intelligence. I’m not just referring to learning more technical moves, or adding more letters after my name.
Instead, I want to learn how money works.
So, I’ve been going through this book: How Rich People Think by Steve Siebold (http://amzn.to/1eWMFUF), and it’s right on the money (bada-bing). For example, here are some traits his book identifies among the rich, as opposed to the middle class:
* Rich people focus on earning, not saving
* They understand that leverage creates wealth, not hard work
* See that they are in control of their wealth, not luck or fate
* Know that money is earned from focused thought, not hard labor
* Don’t see money with emotion, but with logic
* Are Action-Takers (as opposed to having a lottery mindset)
So why do I emphasize that last one? Simple — I’m suggesting you take an action now, which could have a big difference on your 2015 bottom line…
Halftime Tax Adjustments for Mayfield Heights Taxpayers
“My favorite things in life don’t cost any money. It’s really clear that the most precious resource we all have is time.” – Steve Jobs
You know how good coaches are usually famous for making adjustments during the halftime of big games? Well, here I am — acting as your financial coach in matters tax-related, and we’ve just about hit the halftime mark for 2015.
You have six months of financial info to use for some quick math about your year as a whole, and to prepare for a pleasant upcoming tax season.
To begin, all you have to do is take your cash flow for the first half of the year, and multiply by two. Add up your wages, dividends, interest, and any other income, and then–if this represents approximately what you’re expecting for the second half of the year — double the sum.
Once you have your estimated 2015 income, you can give us a call: (440) 720-0959(or send me an email by clicking the button at the top of this page), and we’ll help you determine the appropriate tax rate and deductions to apply. Because once you’re armed with this info, we can help you determine the amount of taxes you might expect to owe for 2015.
By then comparing this against your projected withholding, you can adjust the withholding on your paycheck in advance as needed, and ensure a happy visit to our office in the winter.
This can also be a good time to organize your financial records (about which I recently wrote) and/or get started with some financial software. Getting organized now can make gathering a report of all those deductions a breeze, come tax time.
Because of recent tax changes, wealthy Americans in particular are facing higher tax rates on ordinary and investment income.
That makes it all the more important to review Uncle Sam’s highest-impact tax breaks, such as donations of appreciated assets, tax-free exchanges and capital-loss harvesting.
Unlike obvious moves, such as contributing to an individual retirement account or a 401(k) plan, these strategies require a higher degree of awareness and active planning.
Not all high-impact breaks are for the wealthy. Any homeowner can benefit from a provision allowing taxpayers to pocket tax-free income from renting a residence for as long as two weeks, and low-bracket taxpayers can pay zero tax on long-term capital gains.
Other important moves can help minimize estate, gift and inheritance taxes. Really, there are a variety of tax adjustments we can make to help you with your planning for the year … but you have to let us help you. It is, after all, why we are here.
Warmly (and until next week),
Jeffrey A Campbell CPA