Amid A Mixed Week For Stocks, A Strong Recommendation
Published Friday, September 11, 2020, 8:30 PM EST
It was a mixed week for stocks, and the most important opportunity to manage your wealth wisely right now is in tax planning.
Higher income taxes are expected to hit professionals, business owners, and other high-income earners. Sorry, but the financial balance sheet of the United States recently has been weakened. No matter which party wins the election, higher taxes will be required to pay down the long-term debt of the nation.
Capital gains. Now is the time to start considering selling an appreciated asset in 2020, rather than paying a higher capital gains tax if you think Joe Biden will be elected.
Instalment Sales To Children. Now would be a good time to consider selling property – like real estate – on an instalment loan to your children. Depending on the national election results, you might elect out of the sale on October 15, 2021, after the election and the U.S. tax plan is a done deal.
Payroll Tax And High Earners. In 2020, you're not subject to taxes on wages and salary of more than $137,700. Under Biden's plan, earnings of more than $400,000 would be subject to the 12.4% payroll tax. You may want to consider establishing an S-corp.
The Standard & Poor's 500 stock index closed Friday at 3,340.97, lower by -2.54% from a week ago, but +39.56% over its March 23rd bear market low.
This marks the first time since the height of the pandemic in March where the S&P 500 has posted a loss for two weeks back to back.
Stock prices have swung wildly since the coronavirus crisis started in March and volatility is to be expected in the months ahead.
The Standard & Poor's 500 (S&P 500) is an unmanaged group of securities considered to be representative of the stock market in general. It is a market-value weighted index with each stock's weight proportionate to its market value. Index returns do not include fees or expenses. Investing involves risk, including the loss of principal, and past performance is no guarantee of future results. The investment return and principal value of an investment will fluctuate so that an investor's shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance quoted.
Nothing contained herein is to be considered a solicitation, research material, an investment recommendation or advice of any kind., and it is subject to change without notice. Any investments or strategies referenced herein do not account for the investment objectives, financial situation or needs of any specific person. The material represents an assessment of financial, economics tax law, and proposals for new taxes, at a specific point in time and is not a guarantee of future results.
This material represents an assessment of the market and economic environment at a specific point in time and is not intended to be a forecast of future events or a guarantee of future results. Forward-looking statements are subject to certain risks and uncertainties. Actual results, performance, or achievements may differ materially from those expressed or implied. Information is based on data gathered from what we believe are reliable sources. It is not guaranteed as to accuracy, does not purport to be complete, and is not intended to be used as a primary basis for investment decisions.
- Latest On Inflation, Consumer & Business-Owner Optimism
- Slower Growth But Economic Outlook Remains Bright
- Labor Market And Inflation Drove Stocks Higher
- Costlier Homes Expected To Appreciate 4% Annually For The Next Five Years
- Leading Economic Index Falls For 16th Straight Month
- Tax-Sensitive Investment Planning In 2023
- A Healthy Recipe For Growth Is Simmering
- Good News About The U.S. Economy
- The New Bull Market Has Broadened
- An Economy Goldilocks Would Definitely Live With
- Monthly Pace Of New-Job Creation Slowed In June, Which Is Good News
- Standard & Poor's 500 Gained 9.9% In Q2 2023
- This Week’s News For Investors
- This Week’s News For Investors Is Very Good
- Why The New Bull Market Theory Was In The News This Past Week
- Strong Jobs Report Caps A Week For The Record Books
- Why Stocks Rose Friday Despite A Rise In Inflation In April
- Weekly Investor Update
- The Confluence Of Bad News For Recent Retirees And Those About To Retire
- Good And Bad News This Week For Investors
- Getting There: The Economic Balancing Act Progressed In March
- Stocks Gained Friday But Closed Fractionally Lower For The Week
- Good News On Inflation But A Recession May Be Hard To Avoid
- Analysis: The First Data Since The Banking Crisis Erupted In March