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Volatile Markets A Key Consideration For Midyear Tax Planning

By Sophie Hawthorne
Published in Taxes
June 21, 2023
1 min read
Volatile Markets A Key Consideration For Midyear Tax Planning

I read this great article about midyear tax planning in the volatile markets. Basically, it highlights the importance of evaluating your investments and making necessary adjustments before the end of the year to minimize your tax liability.

First off, the article explains how market volatility can impact your investments and taxes. For instance, if you have stocks or mutual funds that have appreciated significantly, you may end up owing more capital gains taxes. On the other hand, if you have losses, you can use them to offset gains and reduce your tax bill.

The article also stresses the significance of reviewing your retirement account contributions and maximizing them, especially if your income is expected to increase in the future.

What caught my attention was the section about charitable giving. I never knew that donating appreciated assets, such as stocks or mutual funds, can be a tax-smart strategy, allowing you to avoid capital gains taxes while still getting a charitable deduction.

In my own experience, I learned the hard way that neglecting midyear tax planning can lead to unpleasant surprises during tax season. A few years back, I made some investments without realizing the potential tax consequences and ended up owing way more than I expected.

In conclusion, midyear tax planning is crucial, especially in the current climate of volatile markets. It can help you optimize your investments, minimize your tax liability, and potentially save you a lot of money in the long run. So, make sure you talk to your tax advisor or financial planner before the year-end tax rush kicks in!

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Sophie Hawthorne

Sophie Hawthorne

Freelance Writer

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