Archive for December 2016
With the election of a Republican president and a Republican Congress, the tax Wheel of Fortune is spinning again. Since it’s December 2016, you will have to make an educated guess and place your bet now before the wheel comes to a stop.
Tax cuts are very likely, as is a cap on deductions. According to President-elect Trump’s tax proposal, the seven tax brackets will be reduced to three, the top marginal rate will be reduced from 39.6% to 33%, and the 3.8% Obamacare surtax on investment will be repealed. However, itemized deductions that include mortgage interest and charitable donations will be capped at $200k for joint filers.
If you make a few smart moves now, you can potentially save big.
- Delay recognition of incomes and accelerate recognition of expenses/deductions.
- Maximize retirement savings
- Take capital losses.
- Front load your charitable contributions
You can use a donor advised fund to front load your charitable contributions. Take my situation,for example. I typically give about $3000 a year to charities. I now have a d Read the rest of this entry »
A few months ago, I stumbled upon a report about a homework essay written by a nine year old girl, Jia Jia, in rural China. The title of the essay was “If I live to be a grownup 如果我能长大.” It turns out Jia Jia suffers from thalassemia, a blood disease that requires a blood transfusion every 40 days. Without them, she would die. Jia Jia was abandoned by her own parents because they could not afford the medical treatments, but her grandmother refuses to give up on her.
Jia Jia is very aware of her own mortality, but she still has dreams. In the essay, she wrote how she was heartbroken to see her grandmother weep because she did not have enough money for her granddaughter’s treatment. She also wrote that if she lives to be a grownup, she wants to take care of her grandmother so she never has to worry about her again; she wants to become a doctor, so she can treat those people who can’t afford medical treatments.
I was so touched by the overflow of love despite their tragic situation that I called the reporter to get the grandma’s phone number and home address. Read the rest of this entry »