Your Money

The silver lining around portfolio losses is the rarely understood and certainly underutilized strategy of tax-loss harvesting. Just to let you know, like most tax planning strategies, you must complete it by December 31.

Investment gains in non-retirement accounts are taxable. The maximum long-term gain rate is 20%, and the maximum short-term rate is 37%. On top of that, you may also be subject to the 3.8% Net Investment Income Tax (NIIT), also known as the Medicare tax.

This is where harvesting losses can help lower your bill. If you sell an investment at a loss, you can use the loss to offset any gain you might otherwise owe taxes on. Use short-term losses to offset short-term gains and long-term losses to offset long-term gains. Then, any excess losses can be used to offset the opposite kind of gain.

If your losses still exceed your gains after that, you can use up to $3,000 of your net loss to negate ordinary taxable income. Any additional negative money you have left over can be rolled over into the following tax year.

We apply this strategy all year and will do final checks over the coming days. If you have other accounts we don't manage, let us review them for opportunities.

'Don't wait' to make this year-end move that could help cut your tax bill, says CPA
by Ryan Ermy

Your Life

It’s been a trend for 10+ years. Pre-retired couples and individuals start looking at rural areas to retire eventually. Then, upon retirement, they move there. More and more retirees are looking beyond traditional retirement meccas like Florida, Scottsdale, the Ozark Mountains, Myrtle Beach, etc., and opting for a quaint, quiet, and peaceful life in rural areas in TN and NC. This is causing an unexpected boom in these rural communities which means more income but also the need to create more amenities like grocery stores, gourmet and regular; big home supply stores; theaters and restaurants; hospitals and healthcare services; etc. Although, as a whole, rural communities lost residents from 2010-2020—the first decline recorded in the US, some select rural enclaves are booming. The draw also includes people’s desire to be in a lower-cost-of-living area with lots of outdoor activities, temperate weather, and a low-stress environment. In the search for an active lifestyle, retirees are also filling jobs. One retired banker who moved to Sevier County, TN, was offered a finance job at Dollywood but sitting at a desk no longer appealed to him. However, he accepted a position as a tram operator with free tickets to Dollywood as a big incentive. It’s not about the money for many retirees.

They Came, They Hiked, They Stayed: Retirees Lift Fortunes In Rural America
by Kemal Pasha

Complexity Simplified

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