Hellow guys, Welcome to my website, and you are watching Net Investment Income Tax - When does it apply, calculating the impact, and how to avoid. and this vIdeo is uploaded by Arnold & Mote Wealth Management at 2021-11-15T06:00:11-08:00. We are pramote this video only for entertainment and educational perpose only. So, I hop you like our website.
| Name | Net Investment Income Tax - When does it apply, calculating the impact, and how to avoid |
| Video Uploader | Video From Arnold & Mote Wealth Management |
| Upload Date | This Video Uploaded At 15-11-2021 14:00:11 |
| Video Discription | The Net Investment Income Tax is an extra tax that is charged on dividends, interest, and capital gains from your investments. It can also apply to many other forms of income, such as rental income, passive business income, and even certain annuity payments. The tax applies only to individuals and trusts with a MAGI, or Modified Adjusted Gross income, over a certain threshold. If your income is high enough to cause you to be subject to the tax, you will face an extra 3.8% tax on your investment income or a 3.8% tax on the amount that your annual income exceeds those thresholds. For someone who relies on dividends and interest to fund their retirement, or those who use their investments for large purchases such as a house or car in retirement, this tax can easily amount to many thousands of dollars. So, What can you do to avoid this tax? A little bit of planning can go a long way. If you can split large investment sales over two tax years, you could dramatically reduce the amount of income or capital gains subject to the tax. Proper investment account maintenance can also help prevent the net investment income tax as well. Things like tax loss harvesting, or purposely recognizing small gains to raise your cost basis over time can help reduce the impact of this tax later on. Lastly, if you are retired and find yourself frequently hit by the net investment income tax, consider QCDs or Roth Conversions to reduce future required withdrawals and income. |
| Category | Education |
| Tags | net investment income tax | tax planning strategies | investment taxes | taxes in retirement | what taxes do you pay in retirement | taxes on stocks | investment tax surcharge | NIIT | 3.8% tax | tax on investments | tax planning strategies 2021 |
