As many of our baby boomers get ready for the “good life” of retirement, many will begin to start drawing income from their retirement plans that they have spent years building. There are a few tax implications that may affect many boomers when they begin to withdraw funds from retirement plans and/or cash out of stocks. In the next few weeks, I will post a tip for boomers to ensure that their retirement years are spent enjoying life instead of paying a bundle in taxes.
Many retirees will elect to receive Social Security benefits at age 62 (the earliest possible age to receive benefits) at the same time they may have stocks and other securities in their portfolios. If this is this case these retiree should not sell any stocks that have appreciated in value in any of their taxable accounts. This will ensure that any capital gains are avoided thus lowering the AGI (adjusted gross income) and the taxes owed on Social Security benefits. Additionally if the boomer passes away, the heirs will not have to pay any income tax on the investments appreciation during the boomer’s lifetime.
For more information on these tax savings strategies, review Internal Revenue Code Section 1022 (d) (2) or stop by our tax seminar coming later this fall. See our website for more information.
More tax tips to come…in the meantime keep your Business N Synergy!!!
Brian N. Stovallwww.thebricogroup.com