Our weekly roundup of tax-related investment strategies and news your clients may be thinking about.
Clients might be able to beat a 401(k) by investing on their own
Advisers can help clients tweak their outside investments so they return some of the same, or better results, commonly associated with 401(k) plans, according to USA Today. This approach relies on imitating the savings habits of these retirement plan participants. -- USA Today
Don't get spooked by taxes; look now to municipal bonds instead
Clients seeking better after-tax yield are better off with municipal bonds that provide offer tax-free interest income, according to The Street. For example, a 2.2% muni yield is equivalent to 3.9% in taxable yield for investors in the 39.6% tax bracket and paying a 3.8% Medicare surcharge. Muni yields are also exempt from state taxes in several states. The Street
The secret upside to donating to charity directly from an IRA
Making a direct transfer from an IRA to a charity will count the money toward your client's RMD, according to Money. But because it’s not directly distributed to the client, their adjusted gross income won’t increase. This also makes fewer social security dollars taxable. Money
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