In this week’s edition of his YouTube series State of the Market, Chief Income Strategist Marc Lichtenfeld tackles one of investors’ least favorite topics… taxes.
This year, filers have an extra month to give Uncle Sam his due. The deadline to file has been moved to May 17.
How well have you protected your investment income?
Perhaps you already keep your dividend payers in a tax-deferred account, like a 401(k) or IRA…
But for some of your income investments, this could result in you owing thousands of dollars more.
Take master limited partnerships, for example. These investment vehicles pay distributions rather than dividends – and as Marc explains in this week’s video, they should be treated differently from a tax standpoint.
International stocks may also carry different tax implications.
And then you have bonds. Bonds are taxed at your ordinary income tax rate, except for municipal bonds, which are not taxed at the federal level and may not be taxed at the state level either.
When an investment is naturally tax-deferred, it’s often best to hold it in a taxable account in order to save room in tax-deferred accounts (where space is often limited).
There are also special cases in which you may earn a tax credit only if an investment is held in a taxable account.
To get the most out of your money, take a look at this week’s episode of State of the Market and take stock of your own holdings.
You may just find that there’s room for savings…