Welcome to Tax Saving Guide
Tax Exempt Savings Article
. For a permanent link to this article, or to bookmark it for further reading, click here.
You may also listen to this article by using the following controls.
Owning Savings Bonds –Tax Implications
from:Savings bonds have traditionally been a very safe investment. Your savings bonds don’t ever lose their face value, and they build interest over the years that you hold them. However there are some savings bond tax implications you should be aware of.
In general, savings bond interest is taxable income – You have the choice to pay savings bond tax each year as the bond accrues interest or to wait until you cash the bond in to pay the tax. It’s usually a wise idea to wait until you cash in the bond to pay the taxes, in case there’s a chance that you may not have to pay income taxes on the interest. However, if you’re certain that your interest will be taxable and you’ll have to pay the savings bond tax, you may choose to pay the taxes each year as the interest accrues, to prevent having a large tax burden at one time.
You may be able to avoid savings bond tax – There are certain situations that will allow you to avoid paying savings bond tax. The year you cash in your savings bond you can avoid paying the savings bond tax if:
• You pay qualified education expenses for yourself, your spouse, or a dependent for whom you claim an exemption on your return.
• Your modified adjusted gross income (MAGI) is less than $78,100 ($124,700 if filing a joint return).
• Your filing status is not married filing separately.
In order to determine your tax status regarding savings bonds, it’s important to ensure that the savings bonds you hold are qualifying savings bonds. Your savings bonds should be series EE bond issued after 1989 or a series I bond. The bond must be issued either in your name (as the sole owner) or in the name of both you and your spouse (as co-owners). The owner must be at least 24 years old before the bond's issue date. The issue date is printed on the front of the savings bond.*
Savings bonds can be a great way to invest, and they are an inexpensive investment too. And, if you plan carefully, cashing in your savings bonds during years that you are paying for college for yourself or someone else, you can save yourself some tax money, too! It’s always important to work with your tax advisor and your financial advisor to determine the best investments and to determine how to properly file your taxes. Each tax filer’s situation is different, and it’s important to know the tax code before you file, to avoid paying taxes incorrectly.
*Provided by the IRS
Tax Exempt Savings Specific Links
Watch Free Videos At Mevio!
- Tons of Free Videos, Only At Mevio.com
-- http://www.mevio.com/
Free Tech and Gadget Reviews!
- Watch GeekBrief With Cali Lewis on Mevio!
-- http://www.geekbrief.mevio.com/
Free tech talk and news video!
- Watch Tech5 with John C. Dvorak now!
-- http://www.tech5top5.mevio.com/
Watch Funny Videos!
- Click here to see funny videos, pictures, jokes, commercials, and more funny stuff from Comedy.com.
-- http://www.comedy.com/
New Rap Music
- Search Emerging Artists & Help Vote Them Into Stardom. Join Today
-- http://www.ourstage.com/
Tax Exempt Savings News
Liberty Tax Advises that Theres Still Time to Cut Your 2008 Tax Bill If You Act Now (Business Wire via Yahoo! Finance)
VIRGINIA BEACH, Va.----The tax savings you reap in 2009 will depend on any additional tax cutting measures that you can take before the end of 2008, advises Liberty Tax Service. Take the time to review and organize your tax records and identify more deductions that you can take on your 2008 return.
Read more...Amid budget crisis, state cuts Social Security tax (Green Bay Press-Gazette)
MADISON Despite the worst budget deficit in Wisconsin history, many middle-class and wealthy senior citizens are on track to get tax breaks worth an estimated $118 million next year.
Read more...INVESTORSOFFSHORE.COM (Investors Offshore)
The European Commission has formally requested that Luxembourg amend legislation which incorrectly transposes certain provisions of the European Union (EU) savings tax directive.
Read more...Making Gifts to Family Members Can Save Taxes (SmartPros Accounting)
Nov. 24, 2008 (SmartPros) Whether or not a child has a need for funds, an individual with sufficient means should consider making gifts to family members for tax savings.
Read more...Budget expected to keep 5% tax hike (The Sentinel)
Two weeks and not one phone call, not one e-mail. That’s how long Cumberland County’s 2009 preliminary budget has been on public display.
Read more...