Be Aware of More Tax Law Changes

Tip 1: Don’t Forget Your Minimum Required Distribution

There is a minimum required distribution from retirement accounts for those aged 70 1/2 years old or over. In 2009, this distribution requirement was waived for one year due to the sharp decline in reinvestment values during the recession. In 2010, the minium distribution is required once again. If not sure how much you must take out of your accounts, please call.

Tip 2: Time to Review Capital Gains

At the end of 2010 the long-term capital gains tax rates are going up. The current rate of 15% (0% if you are in the 15% or lower income tax bracket) will be reset to earlier levels. The amount will, in all likelihood, be 20%.

Tip 3: Plan for less in Dividends

Through 2010 tax rates on ordinary dividends are taxed at long-term capital gains rate (15% maximum). Starting next year these same dividends will be taxed as ordinary income (up to 39%).

Tip 4: Unemployment Benefits Taxed Once Again

In 2009, the first $2,400 of unemployment benefits an individual received was federal tax-free. This provision does not apply to 2010 so plan ahead.