Back in 2017, Congress made changes to the tax code via the passage of the Tax Cuts and Jobs Act (TCJA). One of its provisions raised the Lifetime Gift Tax Exemption, the amount of assets each person can pass to heirs without estate taxation. TCJA raised the exempt amount from $5.49million to $11.18million per person….
As we head into election season, you will surely hear more rhetoric claiming that the rich don’t pay their fair share of taxes. Warren Buffett is famous for once saying that he paid less in taxes than his secretary did. If Warren really wanted to fix this, he could simply declare a dividend for Berkshire…
Traditional investment advice normally focuses on allocation into buckets. These buckets could be traditional mutual funds, or ETFs, or managed accounts holding individual stocks. In most cases, the allocation buckets are tactically rearranged, and the securities within mutual funds and managed accounts are also actively rearranged. This process of rearranging can easily result in realized…
We get puzzled looks from new clients when we explain our position on taxable fixed income (bonds) in IRAs. Traditional planning advice recommends placing your highest growth assets in an IRA to maximize the tax deferral. We usually recommend the complete opposite approach, which becomes more and more preferable the higher the income of the…
Just in time for Tax Day 2023, Gil talks tax strategy with the Houston Business Journal. “With tax season upon us, it seems an appropriate time to discuss tax strategy with a local specialist. Investors might assume that the frontline professionals for advanced tax strategy are CPAs. However, some investors find that their CPAs work…
Gil published a piece in Forbes Council titled, “Death and Taxes: Not So Certain After All.” After years of writing about the subject, long-time readers will surely realize how degrading taxes are to returns. With market liquidity at all-time highs and trading commissions now free, investors are seemingly incentivized to trade their accounts. The math…
Rather than count the ways, let’s just discuss one for today – tax efficiency. Traditional Mutual Funds Traditional mutual funds, like those from Fidelity, Putnam, or any other fund company, have a particular type of accounting that results in tax inefficiencies for investors. Accounting rules for these open-ended mutual funds force all fund shareholders to…
There are very few tax issues more complicated than the intersection of estate taxes, income taxes, and IRAs. Very few couples exceed the $24million exemption amount to begin with, and even fewer get this part of their planning correct. If not navigated well, this confluence of factors can conspire to cause 80% of an IRA…
Mr. Biden’s new tax policy has proposed yet another angle to get more tax revenue from the “millionaires and billionaires.” This time he’s circling back to see if he can get a tax on unrealized (unsold) taxpayers’ gains after all. The new twist is that this tax policy is limited to those folks with more…
There’s much wisdom in exercising caution when stirring up things long undisturbed. Politicians often run amok in efforts to garner “points” with their constituents. In this case, Mr. Biden ought to have let sleeping dogs lie. His recent attempt to discard the Step-up in Basis Rule, a popular tax loophole, was met with understandable resistance,…
Segment’s strategies are grounded in decades of experience of dealing with things as they are and not as we wish them to be. Sometimes this puts us twenty years ahead of the crowd. With 2021 came a “new” trend: Direct Indexing! Back in 2003, I attended a dinner meeting with an executive from one of the…
Through tax rule changes, President Biden and his allies in Congress are taking aim at high earners and the wealthy in general. Their tax increase proposal is being called the Build Back Better Act (BBBA). That’s a bit of a misnomer, however, since the non-partisan Tax Foundation Equilibrium Model found that as proposed, the Build…
Gil published a piece in Advisor Perspectives entitled “Don’t Overvalue Dividends.” “My advisory firm is a big fan of stocks that pay dividends. Segment’s tax-efficient rising dividend portfolio is our most popular strategy. But if you dig into the numbers, the dividends our holdings pay are not huge. This is because we manage for…
Gil published a piece in Forbes Council titled, “The Implications of Biden’s Proposed Tax Changes.” “Investors are understandably concerned about President Biden’s plans for additional tax revenue. In my experience, these concerns focus primarily on a couple key parts of the president’s proposal. Below, I’ll take a look at what those parts are and their…
Everybody has heard the old saying that nothing is certain in life except death and taxes. But not everyone knows how death and taxes are inextricably linked.
By now, you’ve likely heard that the Biden administration is angling for more of our hard-earned cash. Clearly, low tax rates are wonderful for the economy, but politics often drive less optimal paths. Rather than rehash the tax hikes proposed to corporate and personal tax rates, I thought we should review the issues facing estate…
Segment’s business model is focused on compressing client costs and taxes and letting the market do its work. We operate this way because taxes and costs are controllable to a remarkable extent, and the benefits of doing so are repeatable. Stock pickers and trading-centric methodologies forfeit these benefits in search of market-beating returns. Our methodology’s…
Recent large stock market swings bring about possible benefits by revising our personal tax strategies. For investors with large stock holdings in an IRA, the brutal market reset could make the math of a Roth IRA conversion even more compelling. Now could be a particularly good time because a decline in value would cause a…
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