Capital gain – Hledam http://hledam.biz/ Tue, 20 Jul 2021 18:30:08 +0000 en-US hourly 1 https://wordpress.org/?v=5.7.2 https://hledam.biz/wp-content/uploads/2021/06/icon-2021-07-01T003219.761-150x150.png Capital gain – Hledam http://hledam.biz/ 32 32 Forced recognition of gains in Democrats’ proposed tax changes https://hledam.biz/forced-recognition-of-gains-in-democrats-proposed-tax-changes/ https://hledam.biz/forced-recognition-of-gains-in-democrats-proposed-tax-changes/#respond Tue, 20 Jul 2021 17:06:04 +0000 https://hledam.biz/forced-recognition-of-gains-in-democrats-proposed-tax-changes/ In our recent webinar with the Business Journal, we took an in-depth look at the major income tax and inheritance / gift tax changes proposed by the Biden administration and the Democratic Congress. We have noted the loss of the “increase” of the base on death, the reduction in the amount of a tax-free estate […]]]>

In our recent webinar with the Business Journal, we took an in-depth look at the major income tax and inheritance / gift tax changes proposed by the Biden administration and the Democratic Congress. We have noted the loss of the “increase” of the base on death, the reduction in the amount of a tax-free estate from $ 11.7 million to $ 3.5 million and the increase in the rate of income. capital from 23.8% to 43.4% for earnings over $ 1,000,000. In this article, I would like to highlight the last point of the webinar: the proposed recognition of gain on transfer.

Currently, if I gift an IBM stock to a child that I bought years ago for $ 10 and she immediately sells it for $ 110, she incurs long-term capital gains tax. over $ 100 per share. In other words, when we talk about donations, a donee takes the donor’s tax base, which is called the “carry forward” base.

On the other hand, under the current rules, if my daughter inherits IBM shares from me and immediately sells them for $ 110, she pays no tax because it receives an increase in the tax base to the fair market value of the share on my death. This healthy rule has been a mainstay of family business succession planning for generations. Indeed, one of the first things an estate planning lawyer will advise a corporate client is to place low-tax assets on behalf of the spouse with the shortest life expectancy, usually the husband.

Not only have Democrats proposed removing the deferral base and increasing the base on death, they also want to tax appreciated earnings to transfer. In the examples above, let my gift to my daughter or to my legacy for it would trigger the (greatly increased) tax on capital gains—whether my daughter subsequently sold the shares or not.

What about the transfer in trust? Let’s say a mother wants to transfer part of the family business into an irrevocable trust for her son, a minor who is not old enough to receive a gift. The new law would impose any appreciation of the company’s stock when it is transferred into the trust, and then (later, when Junior has reached the appropriate age) when it comes to outside and is given to him. What about shares that are already in trust? The House bill would tax appreciated assets in trusts every 30 years, the Senate bill every 21. Biden’s bill would trigger a tax for the first time in 2030.

What strategies are suggested if such a transfer tax is put in place? First, there is a tax exemption of $ 1,000,000 ($ 2,000,000 for a couple). This suggests that “smoothing” will become a key concept. For example, if a person sold a business for $ 4,900,000, they could structure the transaction as a 5-year installment sale, so that they would receive five payments of $ 980,000, rather than a single payment of 4. $ 900,000 (which would have triggered a 43.4% tax on the amount over $ 1,000,000).

With the transfer tax, a taxpayer would want to avoid the forced recognition of massive gains. This would recommend taking construction gains more frequently to inhabit lower tax brackets. This could be arranged by transferring to a controlled trust or to a family member.

Finally, when the patriarch / matriarch nears the end of his life, it may be prudent to organize an installment sale of appreciated assets in order to spread the tax on the appreciated assets over a number of years, rather than having to write a big check.

Legal Strategies is sponsored content produced by Johnson & Johnson Law Firm in Canfield.

Copyright 2021 The Business Journal, Youngstown, Ohio.


Source link

]]>
https://hledam.biz/forced-recognition-of-gains-in-democrats-proposed-tax-changes/feed/ 0
Tax Changes As Part Of The Ohio Budget Bill For Fiscal Year 2022-2023 | Dickinson wright https://hledam.biz/tax-changes-as-part-of-the-ohio-budget-bill-for-fiscal-year-2022-2023-dickinson-wright/ https://hledam.biz/tax-changes-as-part-of-the-ohio-budget-bill-for-fiscal-year-2022-2023-dickinson-wright/#respond Fri, 16 Jul 2021 20:11:58 +0000 https://hledam.biz/tax-changes-as-part-of-the-ohio-budget-bill-for-fiscal-year-2022-2023-dickinson-wright/ Ohio Governor Mike DeWine recently signed the Fiscal Year 2022-2023 Budget Bill, which contains several tax provisions and changes that will affect businesses and their owners. The general date of entry into force of the bill is 91st day after being filed with the Ohio Secretary of State. Some of the highlights of the bill […]]]>

Ohio Governor Mike DeWine recently signed the Fiscal Year 2022-2023 Budget Bill, which contains several tax provisions and changes that will affect businesses and their owners. The general date of entry into force of the bill is 91st day after being filed with the Ohio Secretary of State. Some of the highlights of the bill are as follows:

  • An income tax deduction for investors in Ohio-based Certified Venture Capital Operating Companies (“VCOCs”). The deduction will be 100% of the capital gain received by the taxpayer-investor in the tax year attributable to a VCOC’s investment in Ohio businesses and 50% of the capital gain received. an investment of a VCOC in all other companies. The deduction will be available for tax years beginning in 2026.
  • A sales and use tax exemption for employment services and placement services, which is to come into effect one month after the general effective date of the legislation.
  • A requirement that taxpayers use their previous year’s gross taxable revenue, rather than the current year’s gross revenue, to calculate the Business Activities Tax (“CAT”) due on their first million dollars in gross receipts.
  • In calculating the CAT, taxpayers can exclude from gross revenue any excess State Insurance Fund received by the taxpayer from the Ohio Workers’ Compensation Office. The exclusion is expected to come into effect in the 2022 tax year, continuing and making permanent the temporary exclusion currently in effect for the 2020 and 2021 tax years.
  • An income tax deduction for certain eligible taxpayers for a capital gain attributable to the sale of an interest in a business, capped at the lesser of the capital gain from the sale or an amount calculated from the the company’s payroll over a certain period. The deduction is expected to come into effect for tax years beginning in 2026.
  • For tax years beginning on or after January 1, 2021, taxpayers are no longer required to report each business or professional activity from which their business income was derived when claiming the business income deduction.

[View source.]


Source link

]]>
https://hledam.biz/tax-changes-as-part-of-the-ohio-budget-bill-for-fiscal-year-2022-2023-dickinson-wright/feed/ 0
Looking for closed-end fund income? Let this ETF do the work https://hledam.biz/looking-for-closed-end-fund-income-let-this-etf-do-the-work/ https://hledam.biz/looking-for-closed-end-fund-income-let-this-etf-do-the-work/#respond Fri, 09 Jul 2021 15:48:34 +0000 https://hledam.biz/looking-for-closed-end-fund-income-let-this-etf-do-the-work/ For many income investors, closed-end funds are an attractive asset class. These funds typically deliver above-average returns, and there are many instances where closed-end funds trade at a discount to the net asset value (NAV), providing a sort of value proposition. However, choosing the right closed fund is no less tricky than selecting individual stocks. […]]]>

For many income investors, closed-end funds are an attractive asset class. These funds typically deliver above-average returns, and there are many instances where closed-end funds trade at a discount to the net asset value (NAV), providing a sort of value proposition.

However, choosing the right closed fund is no less tricky than selecting individual stocks. Fortunately, the Invesco CEF Income Composite ETF (NYSEARCA: PCEF) makes it easier for investors to venture into this asset class.

PCEF, which is around 11.5 years old, tracks the S-Network Composite Closed-End Fund Index (CEFX). This benchmark is a basket of closed-end funds, which means that PCEF uses a fund of funds structure. In addition to the monthly income generated by closed-end funds and PCEF, there are more advantages to investing in the Invesco fund.

“To begin with, closed-end funds are exempt from corporate tax on the condition that they pass on net investment income (interest and dividends) to shareholders,” explains Alerian analyst Roxanna Islam. “Most CEFs pay these distributions monthly, although some also pay quarterly, compared to traditional fixed income instruments, which pay coupons semi-annually. “

A powerful income solution

With a 30-day SEC yield of 6.46%, the $ 932.1 million PCEF lives up to its billing as a credible income idea, especially in today’s low yield environment. As appealing as this yield and the monthly payout are, there are more benefits than you might think with PCEF, including some tax benefits.

“CEFs also pay net distributions of realized capital gains generally at the end of the year. Some equity and alternative strategy funds, however, expect to earn a large portion of their return through capital gains, rather than dividends or interest, ”adds Islam.

Another advantage offered by closed-end funds appears in the fixed income side, which represents about 64% of the PCEF range. Many closed-end fund managers use leverage – borrowing at lower short-term rates and reinvesting the proceeds at higher-yielding long-term rates. This strategy of increasing income is used by about two-thirds of closed-end funds. As Alerian’s Islam notes, the current climate is also conducive to this strategy.

“Lower interest rate environments, like our current environment, are particularly beneficial for funds that use leverage. As short-term interest rates fall, the cost of leverage (i.e. the cost of borrowing) decreases and the fund’s profits increase as the spread between the cost of borrowing and the rate of investment widens, ”the analyst said.

PCEF, which allocates 36.32% of its weighting to options income strategies, is up nearly 13% since the start of the year.

For more news, information and strategies visit the ETF Education channel.

The opinions and forecasts expressed herein are solely those of Tom Lydon and may not come to fruition. The information on this site should not be used or interpreted as an offer to sell, a solicitation of an offer to buy or a recommendation for any product.


Source link

]]>
https://hledam.biz/looking-for-closed-end-fund-income-let-this-etf-do-the-work/feed/ 0
Pioneer Natural Resources (NYSE: PXD) Receives “Buy” Average Rating from Brokerage Firms https://hledam.biz/pioneer-natural-resources-nyse-pxd-receives-buy-average-rating-from-brokerage-firms/ https://hledam.biz/pioneer-natural-resources-nyse-pxd-receives-buy-average-rating-from-brokerage-firms/#respond Thu, 01 Jul 2021 09:25:38 +0000 https://hledam.biz/pioneer-natural-resources-nyse-pxd-receives-buy-average-rating-from-brokerage-firms/ Shares of Pioneer Natural Resources (NYSE: PXD) have earned a consensus recommendation to “Buy” from the twenty-eight analysts who currently cover the company, Marketbeat reports. Six equity research analysts assigned a conservation rating to the stock, seventeen assigned a buy rating and one issued a strong buy rating for the company. The twelve-month average target […]]]>

Shares of Pioneer Natural Resources (NYSE: PXD) have earned a consensus recommendation to “Buy” from the twenty-eight analysts who currently cover the company, Marketbeat reports. Six equity research analysts assigned a conservation rating to the stock, seventeen assigned a buy rating and one issued a strong buy rating for the company. The twelve-month average target price among brokerage firms that hedged the stock in the past year is $ 187.16.

Several analysts recently commented on the company. KeyCorp raised its price target for Pioneer Natural Resources from $ 178.00 to $ 182.00 and assigned the company an “overweight” rating in a research report on Thursday, June 10. MKM Partners raised its target price on Pioneer Natural Resources from $ 207.00 to $ 220.00 in a research report released on Monday, April 5. TD Securities raised its price target for Pioneer Natural Resources from $ 195.00 to $ 200.00 and assigned the company a “buy” rating in a research report released on Wednesday May 5th. Truist downgraded Pioneer Natural Resources from a “buy” rating to a “keep” rating and set a price target of $ 190.00 for the stock. in a research report on Thursday, May 6. Finally, Sanford C. Bernstein upgraded Pioneer Natural Resources from a “market performance” rating to an “outperformance” rating and raised its price target for the company from $ 156.00 to $ 202.00 in a research report on Monday, June 21.

A number of large investors have recently bought and sold shares of PXD. Vantage Consulting Group Inc purchased a new stake in the shares of Pioneer Natural Resources during the 4th quarter valued at $ 26,000. Childress Capital Advisors LLC purchased a new stake in the shares of Pioneer Natural Resources during the 4th quarter valued at $ 28,000. Contravisory Investment Management Inc. purchased a new stake in the shares of Pioneer Natural Resources during the 1st quarter valued at $ 28,000. Essex Investment Management Co. LLC purchased a new stake in the shares of Pioneer Natural Resources during the 1st quarter valued at $ 30,000. Finally, Parkside Financial Bank & Trust strengthened its position in Pioneer Natural Resources shares by 82.6% in the first quarter. Parkside Financial Bank & Trust now owns 199 shares of the oil and gas development company valued at $ 32,000 after buying 90 more shares in the last quarter. 79.80% of the shares are currently held by hedge funds and other institutional investors.

PXD shares opened at $ 162.52 on Thursday. The stock has a market cap of $ 39.65 billion, a P / E ratio of -57.02, a P / E / G ratio of 1.63 and a beta of 1.93. Pioneer Natural Resources has a one-year low of $ 76.58 and a one-year high of $ 175.37. The company has a leverage ratio of 0.34, a current ratio of 0.79, and a quick ratio of 0.69. The company has a 50-day simple moving average of $ 158.75.

Pioneer Natural Resources (NYSE: PXD) last released its results on Tuesday, May 4. The oil and gas development company reported EPS of $ 1.77 for the quarter, beating analyst consensus estimates of $ 1.42 by $ 0.35. Pioneer Natural Resources posted a positive return on equity of 4.10% and a negative net margin of 6.97%. The company posted revenue of $ 2.44 billion for the quarter, compared to a consensus estimate of $ 2.35 billion. In the same quarter of last year, the company posted EPS of $ 1.15. Pioneer Natural Resources quarterly revenue increased 8.1% compared to the same quarter last year. Sell-side analysts predict that Pioneer Natural Resources will post 11.84 earnings per share for the current year.

The firm also recently announced a quarterly dividend, which will be paid on Wednesday, July 14. Shareholders of record on Wednesday, June 30 will receive a dividend of $ 0.56. This represents an annualized dividend of $ 2.24 and a dividend yield of 1.38%. The ex-date of this dividend is Tuesday, June 29. Pioneer Natural Resources’ payout ratio is currently 136.59%.

About Pioneer Natural Resources

Pioneer Natural Resources Company is an independent oil and gas exploration and production company in the United States. The company explores, develops and produces petroleum, natural gas liquids (NGLs) and gas. It operates in the Permian Basin of West Texas. As of December 31, 2020, the Company had proven undeveloped reserves and proven non-productive developed reserves of 31 million barrels of oil, 17 million barrels of NGL and 88 billion cubic feet of gas; and owned interests in 11 gas processing plants.

Featured article: Trading stops

Analyst Recommendations for Pioneer Natural Resources (NYSE: PXD)

This instant news alert was powered by narrative science technology and MarketBeat financial data to provide readers with the fastest, most accurate reports. This story was reviewed by the MarketBeat editorial team prior to publication. Please send any questions or comments about this story to [email protected]

Featured article: What is an exchange?

7 cryptocurrencies that lead the market higher

An influx of capital pushes cryptocurrency on the rise

There is an influx of money into the cryptocurrency market that is pushing the whole complex higher. Not only is institutional interest peaking, but recognition and use is also increasing. With Bitcoin setting new all-time highs 100% above the highs of 2017, the number of new Bitcoin millionaires is also on the rise.

But Bitcoin isn’t by far the only cryptocurrency on the market today. The number of cryptocurrencies in the market has grown steadily with over 4,000 listed on Coinmarketcap alone. But that doesn’t mean they’re all worth your time. Many, if not most, will not stand the test of time.

One way to judge the market’s interest in a cryptocurrency is its performance gains in the market. A cryptocurrency that rises in value is definitely the one you might want to own. The best method for judging the market’s interest in a cryptocurrency is market capitalization. The cryptocurrency market is worth over $ 1,000 billion and growing, and most of that value centers around the top seven. Together, the 3,993 lowest cryptocurrencies represent only 12% of the market and have yet to prove lasting value.

See the “7 Cryptocurrencies That Lead the Market Higher”.


Source link

]]>
https://hledam.biz/pioneer-natural-resources-nyse-pxd-receives-buy-average-rating-from-brokerage-firms/feed/ 0
Basic taxes to know if you invest your money https://hledam.biz/basic-taxes-to-know-if-you-invest-your-money/ https://hledam.biz/basic-taxes-to-know-if-you-invest-your-money/#respond Wed, 30 Jun 2021 15:59:55 +0000 https://hledam.biz/basic-taxes-to-know-if-you-invest-your-money/ By Kelin Pottier Understanding the tax implications is essential to structure your investment decisions in the most tax-efficient way. Taxes reduce investment returns in the same way as costs and charges. Few people really understand the taxes they pay, let alone think about the allowances and incentives that can significantly affect their bottom line – […]]]>

By Kelin Pottier

Understanding the tax implications is essential to structure your investment decisions in the most tax-efficient way. Taxes reduce investment returns in the same way as costs and charges. Few people really understand the taxes they pay, let alone think about the allowances and incentives that can significantly affect their bottom line – which is why, as an investor, these are the taxes you owe. know.

Income tax

Most people are familiar with income tax, known as Pay As You Earn (PAYE) in South Africa. This is calculated on a sliding scale where the more you earn, the higher your tax bracket and the more tax you pay.

The South African Tax Services (SARS) website tax bracket table.

Which tax bracket you fall into is important because it determines your marginal tax rate, which is the tax rate you pay for each rand of additional income you earn. Any interest income you earn – whether from a savings account, stokvel, or government bond – is included in your overall taxable income and taxed at your marginal tax rate. . The same goes for rental income and real estate investment trust (REIT) distributions, the latter of which invest your money in income-producing real estate.

Withholding tax on dividends

Dividends, the portion of profits that a company pays to its investors, are taxed at a flat rate of 20%. When paying a dividend to investors, a company automatically withholds dividend withholding tax (DWT) and remits it to the South African Revenue Service (SARS) on behalf of the investors.

If a company declares a dividend of R 10 per share, it will pay a tax of R 2 on each share to SARS, and investors will receive the remaining R 8 per share in their brokerage account.

Capital gains tax

When you sell an investment in a collective investment scheme, such as a mutual fund or an exchange-traded fund (ETF) that is bought and sold throughout the day on the stock exchange, for more than you get. have paid, the profit is known as capital gains and is subject to the Capital Gains Tax (CGT). Capital gains are included in your total taxable income at an inclusion rate of 40% and taxed at your marginal tax rate. An inclusion rate of 40% means that 40% of profits are taxed rather than the full 100%.

Capital gains tax is only realized when you sell an investment. If you don’t sell, you pay no CGT. If you only sell part of your investment, you pay CGT on the part sold.

For example, Sindi earns 33,000 rand per month (396,000 rand per year). Its marginal tax rate is 31%. She buys five stocks in a JSE Top 40 ETF for R 100 each (total R 500). The market is having a great run and ETF shares are now worth R200 each. Sindi decides to sell three of the ETF shares (for R600) and makes a profit (i.e. a capital gain) on these three shares. If Sindi sells her ETF shares today, she makes a profit of R300 (R600 from the sale minus a cost of R300). The profit of R300 is included in its taxable income at the inclusion rate of 40% (R300 x 40% = R 120). The R120 is taxed at Sindi’s 31% tax rate, which amounts to R37.20.

How to minimize taxes and maximize returns on your investments

There aren’t many ways to pay your tax owed, although South Africans can reduce their taxes paid and maximize their returns on investment by investing in tax-efficient products, such as retirement funds. . Contributions to a retirement fund are tax deductible and the growth of investments in a retirement product is exempt from tax on interest earned, dividends or capital gains.

Consider two people, Sindi and Samantha, who each earn Rand 400,000 per year at a marginal tax rate of 31%. Sindi contributes R3,000 per month to his retirement pension, an annual contribution of R36,000. Samantha does not contribute to a retirement fund.

By contributing to a retirement product, Sindi reduced his taxable income by Rand 36,000 and saved Rand 11,160 in taxes. Individuals are entitled to tax relief on the lesser of 27.5% of your income and 350,000 Rand.

By not paying tax on the growth of investments in a retirement product, investors are able to accumulate tax benefits over time as they effectively “reinvest” their tax savings and achieve compound growth. on those savings.

There is a good reason why saving for retirement is incentivized because the more we are able to support ourselves in our old age, the less the burden falls on the state and / or other members of society, such as than family and friends of the sick. -prepare. Tax incentives on retirement savings are one of the best tools available to South Africans.

Paying taxes is an important obligation on society, and being tax efficient is a duty to yourself and your family. Every tax rand saved is a rand earned.

The content of this document is provided for general information. It is not intended to constitute and does not constitute financial, tax, legal, investment or other advice.

Kelin Pottier is Product Development Specialist at 10X Investments

PERSONAL FINANCES


Source link

]]>
https://hledam.biz/basic-taxes-to-know-if-you-invest-your-money/feed/ 0