Save On Your Taxes - 529B Plans

We all want to save money on our taxes....right?  Consider funding the cost of future college tuition by contributing to a state sponsored or private section 529 paln.  Contributions to such plans are not subject to the same limitations that apply to Coverdell ESA's.  Earnings on contributions to state sponsored and private section 529 plans will not be subject to federal tax when withdrawn, provide the distributions are used to pay for beneficiary's higher eduction expenses.

For more information about this tax saving tip, check out IRS Pub 970 (Section 529 plans)

Have a YEAHday!

YEAHfounder

Pursuant to applicable U.S. Treasury Regulations, we must advise you that any tax advice included in this communication is not intended or written to be used, and cannot be used, by a recipient for avoiding penalties that may be imposed on the recipient by any governmental taxing authority or agency.

2012 Roth IRAs - What's New?

Roth IRAs allow one to make nondeductible contibutions to an individual retirement account (IRA) that are most likely never taxed again.  You can contribute $5,000 ($6,000 over 50) each year.  For the specifics on Roth IRAs check out IRS Pub 590.

New for 2012....

1. The phase out for contributions have increased:
   • Married Filing Jointly Adjusted Gross Income (AGI) - $173,000 to $183,000
   • Single, Head of Household, Married Filing Separately and did not live with spouse AGI - $110,000 - $125,000 
   • Married Filing Separately and lived with spouse AGI greater than $10,000 you cannot make contribution

Have a YEAHday!

YEAHfounder