Wednesday's tax tip - Volume 12

I've hesitated to post on the following issue because I have been anticipating a change in tax law since it was addressed by the media. But, to date, it does not look like anything will change in the near term.

The issue, the capital gains tax rate.

Next year, if your marginal tax rate is 0%, you will have any capital gains will be taxed at a 0% rate. This is an ideal situation for people with children in college who have little earned income.

A good strategy is to gift your child shares of appreciated stock and sell the stock in their name. Since they may be in the 0% bracket, you may be able to elude any capital gains tax on the transactions.

To date, Congress has not closed this loophole, but look for them to do so in the future.

Business Tip #14 - Record keeping

Every entrepreneur I've ever met has started a business because they either 1) believed they could sell a product or service better than the next guy 2) believed they could produce a product or service better than the next guy or 3) both.

Never have I met an entrepreneur who's primary interest was to administer their business better than the next guy.

Yet the administration is just as important as the selling and producing of your product.

If you are still running your business out of a shoe box, brief case or excel spreadsheet, consider upgrading your accounting skills to an accounting software such as Quickbooks.

I am a Quickbooks Certified ProAdvisor and I can provide you with a free copy of the Quickbooks program Simple Start.

If you have an interest, please email me at gtvcpa@yahoo.com.