How to Avoid Tricky Tax Traps:
From January 2005
Community Comments
Spark a community dialogue. Be the first to contribute by adding your comments.
Small-business owners can also put away up to $41,000 in a solo 401(k) plan. “They’ve been out about a year or two,” says Colson. “Basically, like you would with an employer, you get your $13,000 that you get to put in, and you get to do a profit-sharing contribution on top of that.”
Gimme Shelters
So where’s all the advice about fancy tax shelters and tricky investment plays? Right here:
“Anytime you go into an investment strictly for the tax benefit and it appears too good to be true — if the transaction is purely tax-motivated — it’s going to bring about issues,” says independent CPA Michael Sean Nord in Folsom.
Tax shelters are a hot topic at the Internal Revenue Service, he says, and a lot of loopholes have been plugged up. Resist the temptation to artificially get a tax advantage by shifting benefits from one entity to another, he cautions. Remember Enron.
Universal Advice
“Retirement planning is probably the biggest thing I would pound into everybody,” says Colson. “It’s still amazing how many people don’t maximize their retirement contributions, even the person making in the low six figures, and make sure they are putting in the maximum.”
Continued...
Gimme Shelters
So where’s all the advice about fancy tax shelters and tricky investment plays? Right here:
“Anytime you go into an investment strictly for the tax benefit and it appears too good to be true — if the transaction is purely tax-motivated — it’s going to bring about issues,” says independent CPA Michael Sean Nord in Folsom.
Tax shelters are a hot topic at the Internal Revenue Service, he says, and a lot of loopholes have been plugged up. Resist the temptation to artificially get a tax advantage by shifting benefits from one entity to another, he cautions. Remember Enron.
Universal Advice
“Retirement planning is probably the biggest thing I would pound into everybody,” says Colson. “It’s still amazing how many people don’t maximize their retirement contributions, even the person making in the low six figures, and make sure they are putting in the maximum.”
Continued...
The Magazine
Site Links
Prosper Plus +
- Get Prosper Plus to receive e-mail alerts, special event invites, and content that interests you.
Community
- Join the Community and start participating. It's fast. It's easy. It's free.
Advertise on this site! Show your support for the Prosper Network and reach influential thought leaders and web users like yourself. Contact us to find out how.
© 2004-2007 Prosper Media, LLC. All Rights Reserved. Terms of Use | Privacy Policy
The materials on this site may not be reproduced, distributed, transmitted, cached or otherwise used, except with the prior written permission of Prosper Media, LLC.
Community Comments