In this week's episode of Dollars & Sense, key strategies for protecting yourself from tax identity theft and tips for navigating investment taxes were discussed.
Tax Identity Theft Prevention
- Understanding Tax Identity Theft: A fraudster uses personal information to file a fake tax return and claim a refund.
- Get an IP PIN: Apply for a six-digit Identity Protection Personal Identification Number (IP PIN) from the IRS to prevent fraud.
- Prove Your Identity: Use ID.me to verify identity - submit name, address, and driver's license photo.
- Stay Updated: Once you have an IP PIN, it is automatically renewed annually in your online IRS account.
Investment Tax Management
- Capital Gains Tax: Lower tax rates apply if assets are held for over a year before selling.
- Dividend Tax: Qualified dividends receive lower tax rates if stocks are held for specified periods.
- Retirement Account Withdrawals: Withdrawals before age 59½ incur additional tax penalties unless exceptions are claimed.
- Home Sale Tax: Exclude up to $250,000 for singles and $500,000 for couples from capital gains if lived in the home as primary residence for at least 24 months within a 60-month period.
- Timing Matters: Understanding timing rules is crucial for minimizing taxes on various investments.
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Hosted by Joel Garris, a Certified Financial Planner and Fiduciary at Nelson Financial Planning, Dollars & Sense is one of Central Florida’s longest-running radio programs and a top 25 financial planning podcast. Each week, Joel and his team provide expert insights to help you make sense of all your financial decisions.
👉 Visit our website: nelsonfinancialplanning.com for more resources and to connect with our team of Certified Financial Fiduciaries.
About Joel Garris:
Joel Garris is a Certified Financial Planner and Fiduciary at Nelson Financial Planning. He’s dedicated to providing comprehensive financial advice to help you achieve your retirement goals. With a team of expert advisors, Nelson Financial Planning is committed to delivering personalized and effective retirement and financial planning solutions.
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