General Interest Evangeline Giron
I’VE recently heard so much myth regarding the ability to deduct auto expenses in filing an income tax return. Here are a few pointers to consider:
If you start to use your car for business in 2008, you can either deduct the actual operating costs of your car for business purposes or a flat IRS mileage allowance of 50.5 cents per mile for business mileage for the first half of 2008, and 58 cents per mile after June 30, 2008. For 2009, the rate settles back down to 55 cents per mile.
A revocable living trust provides financial protection in the event you are no longer able to manage your financial affairs yourself. You can be trustee while you are healthy, but if you have a stroke or become otherwise incapacitated, your successor trustee would manage your assets in the trust.
Using a Living Trust for Privacy
Another benefit of revocable living trusts is continued privacy because the instrument will bypass probate. The trust can function like a will, dictating at what age children are to receive trust assets and the percentage shares of the distribution. The trust can be linked to a pour-over will, a short document that names the executor and that determines how taxes, creditors, and final expenses will be paid. The pour-over will directs the executor to gather all assets not included in the trust and pour them over into the trust. Once that happens, the trustee will follow the directions included in the trust. The pour-over will must be filed with the probate court, but because it doesn’t say much, it doesn’t reveal much.
A college education is an investment that pays off. According to The college Board’s annual report, Trends in College Pricing, the median annual income for bachelor’s degree recipients is 80 percent higher than the median income for those with only a high school diploma. over a lifetime that difference exceeds $1,000,000.
Unfortunately, investing in a college education is seldom inexpensive. college planning has become increasingly important over the last decade, as college costs have skyrocketed at over twice the inflation rate.
Without health insurance, a single illness can cause serious, and often irrevocable, financial hardship.
Insurance of any kind is intended to transfer financial risk to an insurance company in exchange for a reasonable insurance premium. Where most insurance coverages pay once a loss has occurred, health insurance has the added benefit of paying to keep your loss from getting worse.
For most of us, our home represents our largest asset. Over time, the management of this asset can make a big difference in our overall financial outlook. One of the largest planning opportunities home ownership brings is the favorable tax treatment afforded the sale of a primary residence.
Home sale as capital gain
The gain on the sale of a home is considered a gain on the sale of a capital asset. Any taxable profit you make is subject to a maximum long-term capital gain rate of 15 percent (5 percent for gains in the 10 percent to 15 percent federal income tax brackets) if you owned the house for more than 12 months. Gain on the sale of a home may only be taxable to the extent it exceeds $250,000 ($500,000 for joint filers) if certain conditions discussed below are met.
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