Search results “Do etfs pay capital gains distributions”
Are ETFs tax-efficient?
ETFs (exchange-traded funds) try to track an index, which helps keep capital gains taxes to a minimum. Learn more about what makes them tax-efficient. Visit https://vgi.vg/2OJv7x2 to learn more about Vanguard ETFs®—all commission-free when bought through a Vanguard account. Or browse our full list of ETFs now at https://vgi.vg/2RRUEq4. For more answers to common ETF questions, visit https://vgi.vg/2PtYVmE. IMPORTANT INFORMATION **You must buy and sell Vanguard ETF Shares through Vanguard Brokerage Services (we offer them commission-free) or through another broker (which may charge commissions). See the Vanguard Brokerage Services commission and fee schedules for full details. Vanguard ETF Shares are not redeemable directly with the issuing fund other than in very large aggregations worth millions of dollars. ETFs are subject to market volatility. When buying or selling an ETF, you will pay or receive the current market price, which may be more or less than net asset value.** **Visit https://vgi.vg/2RUeJMi to obtain prospectuses or, if available, summary prospectuses for Vanguard ETFs. The prospectus contains investment objectives, risks, charges, expenses, and other important information; read and consider carefully before investing.** All investing is subject to risk, including the possible loss of the money you invest. Although our investment professionals are qualified to provide information about Vanguard funds and services, they can't provide tax advice. If your tax situation is complex or if you're uncertain of the interpretation of a specific tax rule, we recommend that you seek advice from a qualified tax professional. © 2018 The Vanguard Group, Inc. All rights reserved. Vanguard Marketing Corporation, Distributor of the Vanguard Funds.
Views: 5772 Vanguard
Mutual Funds Distributions Explained
Tangerine’s Joe Snyder addresses the most frequently asked questions about Mutual Fund distributions, starting with a simple explanation of what they are.
Views: 30490 Tangerine
ETFs and Taxes: What Investors Need to Know
Most ETFs are very tax efficient, but not all. Here is what you need to know. SPDR SP 500: http://www.zacks.com/funds/etf/SPY/profile?cid=CS-YOUTUBE-FT-VID VANGUARD TOTAL BOND MARKET ETF: http://www.zacks.com/funds/etf/BND/profile?cid=CS-YOUTUBE-FT-VID SPDR GOLD SHARES: http://www.zacks.com/funds/etf/GLD/profile?cid=CS-YOUTUBE-FT-VID WISDOMTREE JAPAN HEDGED EQUITY FUND: http://www.zacks.com/funds/etf/DXJ/profile?cid=CS-YOUTUBE-FT-VID Follow us on StockTwits: http://stocktwits.com/ZacksResearch Follow us on Twitter: https://twitter.com/ZacksResearch Like us on Facebook: https://www.facebook.com/ZacksInvestmentResearch
Views: 3109 ZacksInvestmentNews
Why You NEVER Own Mutual Funds In a Taxable Account Part 1
Mutual funds are a tax bomb in your taxable accounts, my friends. Year after year, you will receive distributions which are taxable to you even if you didn't sell shares, and even if your fund is worth LESS than what you started with. Exchange Traded Funds though are much more tax efficient. Most ETFs have NO capital gain distributions to you. This means you pay no capital gain taxes while you own the fund! This is huge. In fact, deferring taxes in your taxable account can increase your net worth by hundreds of thousands which I'll show you in part 4 of this series. So stay tuned! https://www.forbes.com/sites/baldwin/2018/03/28/enjoy-the-etf-tax-dodge-while-you-can/ ================================= If you like what you see, a thumbs up helps A LOT. It tells YouTube that people are engaged and so the Youtube algorithm will show the vide to others who may be interested in the content. So, give me a thumbs up, please! Don't forget to SUBSCRIBE by clicking here: https://www.youtube.com/channel/UCSEzy4i9xrKPoaU9z0_XbmA?sub_confirmation=1 Contact me: [email protected] GET MY BOOKS: Both are FREE to Kindle Unlimited Subscribers! The Tax Bomb In Your Retirement Accounts: How The Roth IRA Can Help You Avoid It https://amzn.to/2LHwQpt Strategic Money Planning: 8 Easy Ways To Put Your House In Order https://amzn.to/2wKGi50 GET ALL MY LATEST BLOGPOSTS: http://heritagewealthplanning.com/blog/ PODCAST: https://itunes.apple.com/us/podcast/josh-scandlen-podcast/id1368065459?mt=2 http://heritagewealthplanning.com/category/podcasts/ LET'S SOCIALIZE! Facebook: http://Facebook.com/heritagewealthplanning Linkedin: https://www.linkedin.com/in/joshscandlen/ Quora: https://www.quora.com/profile/Josh-Scandlen Google +: https://plus.google.com/u/1/108893802372783791910
ETF 101: Capital Gains Distribution CNBC
Find out more at: www.mutualfundsandetfs.com
Views: 375 mutualfundsandetfs
Whoa! Big Capital Gain Distributions from Vanguard This Year!
https://advisors.vanguard.com/iwe/pdf/Preliminary_distributions_102018.pdf ================================= GET ALL MY LATEST BLOGPOSTS: https://heritagewealthplanning.com If you like what you see, a thumbs up helps A LOT. It tells YouTube that people are engaged and so the Youtube algorithm will show the vide to others who may be interested in the content. So, give me a thumbs up, please! Don't forget to SUBSCRIBE by clicking here: https://www.youtube.com/channel/UCSEzy4i9xrKPoaU9z0_XbmA?sub_confirmation=1 Contact me: [email protected] GET MY BOOKS: Both are FREE to Kindle Unlimited Subscribers! The Tax Bomb In Your Retirement Accounts: How The Roth IRA Can Help You Avoid It https://amzn.to/2LHwQpt Strategic Money Planning: 8 Easy Ways To Put Your House In Order https://amzn.to/2wKGi50 PODCAST: https://itunes.apple.com/us/podcast/josh-scandlen-podcast/id1368065459?mt=2 http://heritagewealthplanning.com/category/podcasts/ LET'S SOCIALIZE! Facebook: http://Facebook.com/heritagewealthplanning Linkedin: https://www.linkedin.com/in/joshscandlen/ Quora: https://www.quora.com/profile/Josh-Scandlen Google +: https://plus.google.com/u/1/108893802372783791910
“Understanding Capital Gain Distributions”
It is possible to owe capital gains taxes from owning a mutual fund even if you haven't sold the fund for a gain. Learn why at http://www.moisandfitzgerald.com/news-commentary-events/understanding-capital-gain-distributions/
Could Tax Reform Boost Capital Gains Distributions?
A provision in the Senate’s bill limits fund managers’ ability to use specific share identification, which could lead to higher distributions. For all Morningstar videos: http://www.morningstar.com/cover/videocenter.aspx
Views: 222 Morningstar, Inc.
How To Reduce Taxes On ETF Gains
https://goo.gl/QPCkqk - Start earning with binary options like millions of traders do Investors seeking to beat the market should look to exchange-traded funds (ETFs) for their tax efficiency. The ease of buying and selling ETFs, along with the low transaction costs, offer investors another efficient portfolio-enhancing tool. Tax efficiency is also an important part of their appeal, and is the one we'll focus on in this article. Investors need to understand the tax consequences of ETFs, so they can be proactive with their strategies. We'll begin by exploring the tax rules that apply to ETFs and the exceptions you should be aware of, and then we will show you some money-saving tax strategies that can help you get a great return and beat the market. Read on to learn why these rules can remove restrictions in your financial life. SEE: Introduction To Exchange-Traded FundsGeneral Tax RulesETFs enjoy a more favorable tax treatment than mutual funds due to the unique structure. Mutual funds create and redeem shares with in-kind transactions that are not considered sales. As a result, they do not create taxable events. However, when you sell an ETF, the trade triggers a taxable event. Whether it is a long-term or short-term capital gain or loss depends on how long the ETF was held. In the United States, to receive long-term capital gains treatment you must hold an ETF for more than one year. If you hold the security for one year or less, then it will receive short-term capital gains treatment. It's not all doom-and-gloom for mutual fund investors. The good news is that a mutual fund's generally higher turnover of shares creates more chances for capital gains to be passed through to the investors, compared with the lower-turnover ETFs. SEE: Mutual Fund Or ETF: Which Is Right For You?As with stocks, you are subject to the wash-sale rules if you sell an ETF for a loss and then buy it back within 30 days. A wash sale occurs when you sell or trade a security at a loss, and within 30 days after the sale you: Buy a substantially identical ETF, Acquire a substantially identical ETF in a fully taxable trade or Acquire a contract or option to buy a substantially identical ETF If your loss was disallowed because of the wash-sale rules, you should add the disallowed loss to the cost of the new ETF. This increases your basis in the new ETF. This adjustment postpones the loss deduction until the disposition of the new ETF. Your holding period for the new ETF begins on the same day as the holding period of the ETF that was sold. Many ETFs generate dividends from the stocks they hold. Ordinary (taxable) dividends are the most common type of distribution from a corporation. According to the IRS, you can assume that any dividend you receive on common or preferred stock is an ordinary dividend unless the paying corporation tells you otherwise. These dividends are taxed when paid by the ETF. Qualified dividends are subject to the same maximum tax rate that applies to net capital gains. Your ETF provider should tell you whether the dividends th
Views: 86 ETFs
Can I avoid or minimize capital gain taxes on stocks and mutual funds?
Can I avoid or minimize capital gain taxes on stocks and mutual funds? * 🚀Ready To Take Your Business To The Next Level While Protecting Your Assets From Frivolous Lawsuits? ~*~ 💰Get Your FREE 30 min Consultation & Wealth Planning Blueprint NOW! https://AndersonAdvisors.com/register-now-a Check out https://AndersonAdvisors.com for financial strategies and details on upcoming workshops. ** SUBSCRIBE** Anderson Business Advisors Youtube Channel https://www.youtube.com/c/AndersonBusinessAdvisors CLINT INFO 800.706.4741 [email protected] https://AndersonAdvisors.com Twitter: @Clint_Coons Blog: https://ClintCoons.wordpress.com TOBY INFO 800.706.4741 [email protected] https://AndersonAdvisors.com Twitter: @TaxWiseToby Blog: https://TobyMathis.com The information provided in this video should not be construed or relied on as legal advice for any specific fact or circumstance. Its content was prepared by Anderson Business Advisors with its main office at 3225 McLeod Drive Suite 100 Las Vegas, Nevada 89121. This video is designed for entertainment and information purposes only. Viewing this video does not create an attorney-client relationship with Anderson Business Advisors or any of its lawyers. You should not act or rely on any of the information contained herein without seeking professional legal advice.
Mutual fund NAV, distributions, and taxes
Change in NAV, distributions Let's run through a short example to show how you can make money in a stock mutual fund. Say you bought a stock fund in January for $10 a share. The market rose after your investment and by June the fund's net asset value or NAV had increased to $12. Note this higher share price also reflects some cash dividend payments that the underlying stocks had paid to the fund, and which the fund saved in it's cash reserves. By September the stock market dropped. But your fund manager sold some of the fund's stock before the drop, so the fund has some internally realized gains. The fund is now worth $11 per share. Finally, in early December, the stock market has gone back up, and the fund's price is now $13 per share. Remember this includes cash dividends received and internal gains or losses for the year. In late December the fund is required to make distributions of its dividends received and internal gains. On a certain date, called the ex-dividend date, the fund distributes this money to shareholders. Suppose each mutual fund share is entitled to $1 in dividend income from the underlying shares, and $1 of internally realized gains. So on the ex-dividend date, the share price of the mutual fund will go from $13 to $11, even if the overall stock market is flat. Your fund's share price dropped $2 in an otherwise flat market, but you received $2 in distributions so you really haven't lost anything. You can either reinvest your money and buy more shares with your $2 distribution, or take it as a check for living expenses. So for the year, you made a 30 percent return. You made $1 in dividend income, $1 in realized internal capital gains, and $1 in unrealized capital gains since the fund price moved from $10 to $11 by the end of the year. Taxation of mutual fund distributions The $2 you received in distributions are taxable, unless you hold the mutual fund in a retirement account. The $1 in dividend income is taxable as ordinary income on Schedule B of your return, and the $1 in internally realized gains goes on Schedule D. Notice that the $1 in unrealized gains is not taxed. Changes in share price are not taxable until you actually sell the shares. This is why you may want a fund that has low dividend and capital gains distributions if you're not investing through a retirement account. If you're investing in a taxable mutual fund, don't invest in the fund right before its distribution date. Otherwise you'll be hit immediately with a taxable distribution, and you'll wind up paying taxes on someone else's gains. Portfolio turnover and taxes Mutual funds that have low portfolio turnover generally have low capital gains distributions. Likewise, funds that invest in growth companies that pay low dividends have low dividend distributions but a greater chance for share appreciation. Since dividend and internally realized capital gains distributions are taxable, you may want to stick with growth stock mutual funds that have low turnover for your taxable mutual funds. Likewise, place funds that have high turnover rates and high dividend or interest payments into your retirement accounts. Copyright 1997 by David Luhman
Views: 3172 MoneyHop.com
Are Capital Gains Distributions Considered Dividends
Investors must evaluate the total return yield and CGY of an investment. A CGY evaluation does not include dividends; however, depending on the stock, dividends may include a considerable part of the total return in comparison to capital gains. ... However, if a stock decreases in value, it is a capital loss.Short-term capital gains distributions are taxed at the shareholder's ordinary income tax rate. ... Taxpayers in the two lowest brackets, 10% and 15%, pay no long-term gains tax. Most others pay a 15% capital gains tax with the exception of those in the highest tax bracket, who pay a 20% tax on long-term gains.Dividends and distributions often appear the same from the recipient's perspective. Dividends may or may not involve cash. For tax purposes, companies derive them from a share of their income. In contrast, distributions always come in the form of cash payouts.A capital gain distribution is when the mutual fund, or ETF, has sold assets and now has capital gains. They then pass the gains onto the investors. These gains are either paid directly to the investors, or are used to purchase additional shares and those are credited to the investors accounts.
Views: 2 Health Is Wealth
ETFs vs. Index Funds: Investing 101 w/ Doug Flynn, CFP
Doug Flynn, CFP, of Flynn Zito Capital Management, LLC on ETFs vs. Index Funds. Ali: Explain the difference between an ETF and a mutual fund... Doug: Well an ETF is a mutual fund that you know and love, but it trades on the exchange, so you can buy throughout the day. Versus a traditional fund which trades once a day at the end of the day. Ali: Okay, so let's talk about index funds, which really came first. First you had stocks, then you had index funds. Doug: Yes, an index fund is just trying to replicate a particular index, which you can't invest in directly, but this is a way to replicate that. So if you like the stocks in the S&P 500, or the stocks in the Dow... Ali: It used to be that you could just read about the stocks in the Dow or the S&P 500, and buy the individual stocks. If you wanted to, you could buy all thirty in the Dow... Doug: That's right. Ali: But then, we came up with index funds, which said, "You can do the Dow, you can do the S&P 500, you can do the Nasdaq, you can do...I don't know...Easter European industries. Doug: Exactly, and that is going to track an index, there isn't a lot of trading or active management in there. You can do that in a traditional mutual fund format or in an ETF, which is the exchange traded version of that, which just means it trades throughout the day. Ali: Generally speaking, index brought the management fees, these fees associated with mutual funds, down, because there's not somebody doing a lot of active work, and ETFs brought them down further. Doug: Correct. Ali: So why would I choose one vs. the other? Doug: So if you buy an ETF, you're typically placing a trade like a stock. So, if you're with an online broker, they're typically going to charge you some type of a trading fee to do that, whereas a mutual fund may have a minimum, but won't necessarily have a transaction charge to do that. There are some cases where that isn't the case. Ali: If you're doing this for fees, you better look at this and understand that you're paying for trades. Doug: Yeah. Most people are putting money away each month. You know, one hundred dollars per month is what they're doing. You can't really do that with an ETF because you're making a transaction every single time. That's where a mutual fund might be better. Ali: So you're putting one hundred bucks a month away, but you're paying ten dollars for the transaction, you gotta weigh that in. Doug: Maybe you use the index fund for a little while, and then you have $10,000, and then you can actually do those transactions. So that's where you might want it in different ways. And that's where it's cheaper. Like anything else, the more money you have, it might be a little bit cheaper. Ali: One thing you warn is not all ETFs are created equal. What do you mean by that? Doug: Well as an example, the two major providers, there's Vanguard, there's i Shares, which are two different providers of ETFs. And you have to look at the structure. And the structure of i shares in particular, they're completely separate, which means their tax ramifications are very low. They don't necessarily pay capital gains to speak of because they're just trading in and out of the ETF structure by itself: it's a stand-alone ETF. Vanguard did what is kind of a bolt-on to its existing mutual funds. What's happened there, is some cases, when the fund pays a capital gains distribution... Ali: Because they sold a stock at a profit... Doug: Right, a large institution wants to sell a bunch of their funds, it transfers into the ETF itself. So all ETFs are not created equal, and you should look at, if I want bond index ETFs, look a little bit deeper and look where are there capital gains distributions. Many people know there are these issues in traditional mutual funds that are actively managed. And they don't scroll down and see if there are differences between the different ETF providers. Ali: And of course that makes a difference depending on how you're investing. Whether this is inside a tax-preferred investment, or it's just out in the open. Doug: If it's an IRA it doesn't really matter, but if it's in a taxable accound, the last thing you want is further tax surprises you thought you were avoiding by being in ETF format. Ali: This is a business for people who feel they're not going to outperform the market with their own selections. Doug: Exactly, you've said in a particular area I don't think I can bring value, I can't find a manager who will bring value in a particular are, I'm just going to index then. And as a portfolio manager and as people who manage money, there are times when we find that you can't bring value with managers, and that they're out of favor, and you might index more. But we're agnostic.
Views: 46565 FlynnZito
Taxes on mutual fund distributions
It is still early, but the potential for taxes on your mutual fund income may be troubling you already. Subscribe to WMUR on YouTube now: http://bit.ly/1lOjX9C Get more Manchester news: http://www.wmur.com/ Like us: https://www.facebook.com/wmur9 Follow us: https://twitter.com/WMUR9 Google+: http://plus.google.com/+wmur
Views: 811 WMUR-TV
Asset Location: Where to Hold Your Assets Based on Tax Efficiency
There are three types of accounts where you can hold your assets. Determining which accounts you place certain assets, based on tax-efficiency and expected return, can have a significant impact on your after-tax net returns. Taxable accounts, such as your individual accounts and trust, are taxed at the capital gains tax rate when distributed. Deposits in this account are after-tax. Tax-free accounts, such as a Roth IRA, grow 100% tax-free and there is no tax on distributions. However, you do pay tax on the deposit based on ordinary income. Tax-deferred accounts are subject to ordinary income tax rates upon distribution, but there is no tax paid on the deposit, instead, it's deferred until later. In this video, Jason Thomas, CFP® explains how to strategically locate your assets to try to produce the highest after-tax net returns. Important Points: (00:12) - The difference between Asset Location vs. Asset Allocation (00:52) - There are three different pools of money and they are all taxed differently: tax-free, taxable, and tax deferred (01:56) - Where to place tax inefficient items and tax advantage items (02:15) - Where to place the investments: stocks (02:44) - Where to place the investments: bonds (03:31) - Where to place the investments: mutual funds (04:30) - Where to place the investments: exchange traded funds (ETF) (06:25) - Prioritizing assets classes (07:36) - Asset Allocation If you would like to schedule a free assessment with one of our CFP® professionals, click here: https://purefinancial.com/lp/free-assessment/ Make sure to subscribe to our channel for more helpful tips and stay tuned for the next episode of “Your Money, Your Wealth.” https://www.youtube.com/subscription_center?add_user=PureFinancialCFP Channels & show times: http://yourmoneyyourwealth.com https://purefinancial.com IMPORTANT DISCLOSURES: • Investment Advisory and Financial Planning Services are offered through Pure Financial Advisors, Inc. A Registered Investment Advisor. • Pure Financial Advisors Inc. does not offer tax or legal advice. Consult with their tax advisor or attorney regarding specific situations. • Opinions expressed are subject to change without notice and are not intended as investment advice or to predict future performance. • Investing involves risk including the potential loss of principal. No investment strategy can guarantee a profit or protect against loss in periods of declining values. • All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy. • Intended for educational purposes only and are not intended as individualized advice or a guarantee that you will achieve a desired result. Before implementing any strategies discussed you should consult your tax and financial advisors.
How capital gains tax works - MoneyWeek Investment Tutorials
Before you sell an investment, you need to think about the tax on any profits you make. In this video, Tim Bennett introduces capital gains tax.
Views: 131085 MoneyWeek
Why You NEVER Own Mutual Funds In a Taxable Account (Part 2)
In part two of our series on Mutual Funds Vs. Exchange Traded Funds, I share with you an article from Rob Arnott at Research Affiliates Rob might be the most important investment person you've never heard of. Been around a LONG time and his, and his firm's research, is always top shelf and simply must read material. In this article Rob talks about how nearly impossible it is for an active manager to beat a simple passive index when it comes to returns NET of fees. To those who follow my channel, that insight isn't very helpful as this has been shown time and again. However, Rob goes deeper and factors in TAXES too. Throw in the tax inefficiency of a mutual fund, especially a high turnover one, and the active manager has almost no ability to outperform a passive index exchange traded fund. Remember, my friends, ETFs have better tax treatment in that many pay NO capital gains distributions! The same can not be said of mutual funds. Thus, you're going to have to do a LOT to convince me why you should have a mutual fund in a taxable account as opposed to an ETF. https://www.researchaffiliates.com/en_us/publications/articles/675-is-your-alpha-big-enough-to-cover-its-taxes-a-quartercentury-retrospective.html?evar36=eml_AlphaTax_Vid_0618_Hero_CTA&_cldee=bWZAY2FtYnJpYWludmVzdG1lbnRzLmNvbQ%3d%3d&recipientid=contact-36f7871cc8cbe2119aa7005056bc3cff-c01167da640a44d094d18077a8fd13eb&esid=ac9f33b5-0c70-e811-80d6-005056bc1247. ================================= If you like what you see, a thumbs up helps A LOT. It tells YouTube that people are engaged and so the Youtube algorithm will show the vide to others who may be interested in the content. So, give me a thumbs up, please! Don't forget to SUBSCRIBE by clicking here: https://www.youtube.com/channel/UCSEzy4i9xrKPoaU9z0_XbmA?sub_confirmation=1 Contact me: [email protected] GET MY BOOKS: Both are FREE to Kindle Unlimited Subscribers! The Tax Bomb In Your Retirement Accounts: How The Roth IRA Can Help You Avoid It https://amzn.to/2LHwQpt Strategic Money Planning: 8 Easy Ways To Put Your House In Order https://amzn.to/2wKGi50 GET ALL MY LATEST BLOGPOSTS: http://heritagewealthplanning.com/blog/ PODCAST: https://itunes.apple.com/us/podcast/josh-scandlen-podcast/id1368065459?mt=2 http://heritagewealthplanning.com/category/podcasts/ LET'S SOCIALIZE! Facebook: http://Facebook.com/heritagewealthplanning Linkedin: https://www.linkedin.com/in/joshscandlen/ Quora: https://www.quora.com/profile/Josh-Scandlen Google +: https://plus.google.com/u/1/108893802372783791910
💰💰How to Reinvest your capital gains and dividends into mutual funds 📈 (scottrade)
💰💰How to Reinvest your capital gains and dividends into mutual funds 📈 (scottrade) 📈Reinvestment Options for Mutual Funds. Dividends. There are two options for dividends ... Payout will allow mutual fund distributions to be paid in cash to your Scottrade account📈 Also save Money 💰HERE💰 http://hosmarket.weebly.com/ Visit my Website for coupons promo codes discounts and VIP links 📈📈📈📈Check out the Referral Code to get free trades on scottrade CODE - Referred by: TERRANCE NELSON Refer ALL code: LRWQ5965💰💰
Comparing ETFs Vs. Mutual Funds For Tax Efficiency
https://goo.gl/QPCkqk - Start earning with binary options like millions of traders do Exchange-traded funds, or ETFs, are significantly more tax-efficient investments than mutual funds. This is primarily due to the differences in structure between the two investments and the different way in which these two investment instruments are traded. The basics of taxation for either mutual funds or ETFs is if they appreciate in value so an investor realizes a profit, a capital gain is then created and taxes are due. Some overstate the case for ETFs and talk about them as if they were tax-free. That is not the case. The government still wants a piece of all capital gains realized, either through appreciation in net asset value, or NAV, or through any dividends that may be received. Of course, capital gains are tax-deferred until retirement if an investor's mutual funds or ETFs are purchased and sold in an employer-sponsored retirement plan, such as a 401(k), or in an individual retirement account, or IRA. However, there remains a distinct tax advantage for ETF investors revealed by a basic statistical analysis. In the period from 2000 through 2010, the average small cap-oriented mutual fund produced capital gains to shareholders equal to roughly 7% of NAV. Over the same time frame, a comparable small cap-focused ETF only paid out capital gains equal to about 0.02% of net asset value. This is a huge gap and represents a huge difference in corresponding tax liability. ETFs and Tax Efficiency One of the main reasons ETFs are more tax efficient is due to the fact they generally create fewer taxable events than most mutual funds. The overwhelming majority of ETFs only sell holdings when the elements that compose their underlying index change. A significantly lower portfolio turnover rate means significantly fewer taxable gain incidents. Some actively traded equity mutual funds have turnover rates higher than 100%. In contrast, the average turnover rate for an ETF is less than 10%. In respect to this aspect of ETFs versus mutual funds, ETFs that aim to mirror the performance of specialized, nontraditional indexes or are constructed using proprietary criteria for portfolio selections, may have notably higher turnover rates. However, the turnover rate is still, in all likelihood, lower than the average for mutual funds. A Basic Structural Difference The primary differential in tax efficiency stems from the fundamentally different way in which ETFs are structured, or the specific type of investment asset they are as compared to mutual funds. One of the key structural differences is while ETFs are traded on exchanges, just like individual stocks, mutual fund shares are bought directly from, and sold directly to, the mutual fund company. What this means for an individual investing in a mutual fund is the choices and actions of his fellow fund investors can affect the individual's own tax liability. This is not true for ETFs. The way this happens is if other investors in the mutual fund decide to sell, or redeem, a substantial amount of share
Views: 93 ETFs
Do I Have to Report a Capital Gains Distribution if the Money Was Rein... : Financial Planning Tips
Subscribe Now: http://www.youtube.com/subscription_center?add_user=Ehowfinance Watch More: http://www.youtube.com/Ehowfinance When you need to report a capital gains distribution depends on a few key factors. Find out if you have to report a capital gains distribution if the money was reinvested with help from a financial planner in this free video clip. Expert: Karen Lee Filmmaker: Edward Castner Series Description: Making money is one thing - saving money and making sure you're getting your full dollar's worth on a purchase can sometimes be something else entirely. Get money related tips and find out how to make the most for your money with help from a financial planner in this free video series.
Views: 284 ehowfinance
Investing In REITs For Dividends (Pros & Cons of Real Estate Investment Trusts)
Are you considering an investment in REITs (or Real Estate Investment Trusts) for dividends and cash flow? I personally own only one REIT in my dividend portfolio and consider my REIT an ancillary (non-core) position. That being said, I am in a unique situation because I work in the real estate industry and own a home (I am already over-weighted, at a high level, in the real estate industry). A subscriber question, today's video goes into a multitude of pros, cons, and factors to consider about investing in real estate investment trusts for dividend income. * Do you work in the real estate industry? Do you already own a home? Do you own physical real estate investments? If so, those are all factors worth considering when contemplating REITs for one’s dividend portfolio. When looking at diversification, I don't only look at my portfolio. I look at all factors in my life. If the real estate industry tanks, I don't want to get hit on the job front, the home front, and the portfolio front all at once! * Real estate investment trusts carry important tax considerations. As pass through entities, they avoid double taxation (and are required to distribute most of their earnings). That said, the shareowner has to pay ordinary income on dividends (as compared to long term capital gains on qualified dividends of most corporations). Long story short, the tax rate on dividends from REITs is higher than your typical dividend-paying corporation. Moreover, reporting REIT dividends on one's tax return can be complicated (the distributions sometimes involve ordinary income and return of capital). Learn why it's important to weigh tax considerations when investing in real estate investment trusts for dividends and cash flow. * Since some REITs pay dividends on a monthly basis, they can help you stay in the game. Those monthly dividend checks are great for reinvesting and building one’s portfolio. A subscriber insight, I really love this idea! * Interest rates are really low right now. As interest rates rise, some REITs may face challenges securing (affordable) capital to do deals. This could affect short-term and future prospects. * The retail industry is going through a lot of change. When investing in REITs, it's a wise idea to understand exposure to retail. * Sometimes, one can experience superior results by investing in real estate directly. It may be more effective to invest in rental properties than going the REIT route. That said, real estate investment trusts are easier since one does not have to actively manage the real estate assets. Disclaimer: I'm not a licensed investment advisor, and today's video is just for entertainment and fun. This video is NOT investment advice. Please talk to your licensed investment advisor before making any financial decisions. All content on my YouTube channel is (c) Copyright IJL Productions LLC.
Views: 53286 ppcian
Mutual Fund Distributions - Part 1
After the recovery from the 2008 financial collapse, mutual fund holders are receiving more capital gains distributions. Ron Hansen explains in a Money Talk Video. IRS Publication 550, Investment Income and Expenses http://www.irs.gov/publications/p550/ FAQ About Taxation for Mutual Fund Investors, Investment Company Institute http://www.ici.org/policy/current_issues/faqs_taxation_investors Ron Hansen is vice president and investment advisor at Landaas & Company. http://www.landaas.com/about/talent/advisors/ronald-hansen Money Talk Video by Peter May http://www.landaas.com/about/talent/support-staff/peter-may More information and insight from Money Talk http://www.landaas.com/money-talk Money Talk Videos http://www.landaas.com/money-talk/money-talk-videos Landaas & Company Money Talk newsletter http://www.landaas.com/about/newsletter Follow Landaas & Company on Twitter http://www.Twitter.com/@_Money_Talk (initially posted April 3, 2014)
Views: 1138 Money Talk
Mutual fund taxation
Taxation Before investing in a fund, you should consider the tax consequences. Here, one of the most important questions you should ask is, "Is this fund going to be taxable or will it be sheltered in a retirement account?" The answer will affect which fund you should select. Always ask "Is this for a retirement account?" Whenever someone asks me, "Which fund should I invest in?" I always reply, "What's the objective of the investment?" If they respond, "Retirement", my second question always is, "Are you investing this money through a retirement account like an IRA or a 401(k)?" If you're saving through a retirement account, picking mutual funds becomes much simpler because you don't have to worry about taxes until you retire and begin to withdraw the funds. Let's say that you've invested in mutual funds through an IRA or 401(k) type account. You can trade those funds as many times as you want inside the retirement account and you won't have to pay any capital gains taxes or taxes on the distributions made by the fund until you retire. Keep trading and income funds inside retirement accounts So if you like to trade, you should do your trading inside your retirement accounts. Likewise, you should keep funds that have high distributions inside your retirement accounts. Here's an example to show how you might want to manage mutual funds in taxable and non-taxable accounts. Assume you're 35 years old, single, and don't have a retirement plan at work. Since you're on your own, you figure you need to save at least $4,000 per year for retirement. About the only retirement account option for you is an IRA, but your contributions to an IRA are limited to $2,000 or your earned income. You could save for retirement through an annuity, but annuities are expensive and inflexible, so this isn't a great option. So to minimize your taxes and have a balanced portfolio, here's what you could do. Put $2,000 into your IRA, and the other $2,000 into a normal, non-sheltered mutual fund. You're still pretty young, so you can afford to put most of your retirement money into stocks. Of the $2,000 that you put into your IRA, you might want to put $1,000 into bonds, and $1,000 into blue chip stocks. Of the remaining $2,000 which can't be put into the IRA, you might want to put this into a an index fund which invests in small company stocks. If you do this your total portfolio provides you with good diversification across bonds and various types of stocks, and ensures that you'll pay a minimum in taxes. Bond funds tend to make high distributions of their interest earnings. By placing the bond portion of your portfolio inside the IRA, you won't have to pay taxes on the interest earnings until you retire. Blue chip stock funds also tend to make high distributions of dividends paid by established companies. By placing these high-dividend-paying stocks inside your IRA, you again avoid paying taxes until you retire. Use small cap index funds outside of retirement accounts Finally, your unsheltered investment in the small company stock index fund saves you in taxes as well. Index funds simply buy and hold a predetermined basket of stocks like the Standard & Poors 500 index for large companies, or the Russell 2000 for small companies. Index funds don't have many internal trades, so they don't have many internally realized capital gains distributions. This reduces your annual tax payments. Also, small company stocks usually make low dividend payments. They're growing companies, so they don't want to pay out their profits as dividends. They reinvest their profits in the business so the business can grow further. The low dividend payments made by these companies means that they'll probably grow faster than the more established blue chip companies. This hopefully will translate into a higher share price for you. But you won't have to pay any capital gains taxes on the higher share prices until you sell the shares. Money market funds simplify your taxes So when you invest in mutual funds outside of a retirement account, try to minimize your taxes by selecting a fund with low trading activity and low distributions. However, even the most tax-efficient stock or bond fund will complicate your taxes if it's not inside a retirement account. Money market mutual funds, however, don't complicate your taxes because these funds try to maintain a stable share price. All the money you make with money market funds is essentially interest income, and you shouldn't have any capital gains or losses. But if you invest in a bond or stock fund, your taxes become more complex because of capital gains. In fact, because of tax complications, you may want to think twice about investing in bond funds outside of a retirement account. Bond funds versus CDs - tax complications Copyright 1997 by David Luhman
Views: 6800 MoneyHop.com
Unwanted surprise - capital gain distribution on mutual funds 10.21.2015
Be careful when making your mutual fund purchases in taxable accounts during the rest of this year. You could receive an unwanted “surprise” gift in the form of a capital gain distribution. Capital gain distributions more than tripled from 2012 to 2014. It’s one thing to get a capital gain distribution when the market has had a good year, but it’s frustrating to get a capital gain distribution if the market ends the year in negative territory. Paying taxes in a negative year feel like adding insult to injury. -uploaded in HD at http://www.TunesToTube.com
Views: 395 HCM Wealth
Capital Gains On Mutual Funds
Did you know you may have to pay capital gains?
Views: 547 Renee Cabourne
Mutual Fund Distributions - Part 2
More capital gain distributions from mutual funds recently means investors need to be aware of possible tax consequences, Ron Hansen says in a Money Talk Video. IRS Publication 550, Investment Income and Expenses http://www.irs.gov/publications/p550/ FAQ About Taxation for Mutual Fund Investors, Investment Company Institute http://www.ici.org/policy/current_issues/faqs_taxation_investors Ron Hansen is vice president and investment advisor at Landaas & Company. http://www.landaas.com/about/talent/advisors/ronald-hansen Money Talk Video by Peter May http://www.landaas.com/about/talent/support-staff/peter-may More information and insight from Money Talk http://www.landaas.com/money-talk Money Talk Videos http://www.landaas.com/money-talk/money-talk-videos Landaas & Company Money Talk newsletter http://www.landaas.com/about/newsletter Follow Landaas & Company on Twitter http://www.Twitter.com/@_Money_Talk (initially posted April 7, 2014)
Views: 379 Money Talk
Chapter 5: Are Mutual Funds or ETFs Right for You? | Fidelity
In this video series, you will learn about whether investing in mutual funds or ETFs might be the right choice for you based on your current financial situation and goals. To open a brokerage account, visit: https://www.fidelity.com/open-account/overview To watch more videos in this series, visit: https://www.youtube.com/playlist?list=PLGKKmEmJDSiKoM-mD24lmaUeupHP62cDW To see more videos from Fidelity Investments, subscribe to: https://www.youtube.com/fidelityinvestments Facebook: https://www.facebook.com/fidelityinvestments Twitter: https://www.twitter.com/fidelity Google+: https://plus.google.com/+fidelity LinkedIn: https://www.linkedin.com/company/fidelity-investments -------------------------------------------------------------------------------------------------------------------------------------------------------------------- Amy is an investor that finds herself in a high tax bracket, and is quite concerned with this situation. She needs an investment that offers her tax efficiency in her taxable account. After some research, Amy has found that if a mutual fund and an ETF are similar, the ETF, in general, has the potential to be more tax efficient than the mutual fund. Why is that? Let’s say Amy owns shares in an ETF, and another shareholder decides to sell some of his shares. That shareholder simply sells the shares to another investor…very similar to selling a stock. There would generally be no capital gains transactions for the ETF as a whole, or for the other shareholders of the ETF. However, if Amy owns shares in a mutual fund, and another shareholder decides to sell some of his shares, the mutual fund may need to sell some securities to raise the cash needed to meet that redemption. This action may incur capital gains for ALL of the mutual fund’s shareholders. Amy does not want her exposure to taxes impacted by the action of other shareholders. For this reason, she opts to invest in the ETF. And Amy is also happy to learn that, at Fidelity, she has access to research tools to help find and evaluate ETF investments. And numerous choices, including Fidelity’s sector ETFs and iShares® ETFs, which she can buy commission-free online. Fidelity Brokerage Services LLC, Member NYSE, SIPC, 900 Salem Street, Smithfield, Rhode Island, 02917 682198.2.0
Views: 11794 Fidelity Investments
How to Pay No Tax on Dividends and Capital Gains
If you are married filing jointly with taxable income of $77,400 or less, you are in the 12% tax bracket. However, add $1 more and you are in the 22% bracket. See how that works? $77,400 = 12% bracket. $77,401 = 22% bracket. This is how marginal rates work: the more income you receive the higher the tax rate on that additional income will be. The tax you paid on your previous income doesn’t change though. You only pay higher taxes on the amount that puts you into the next bracket. How Qualified Dividends and Long-Term Gains Are Taxed Now, let’s say you have total income of $70,000 which consists of $60,000 of work income and $10,000 in the form of Qualified Dividend Income (QDI) and Long Term Capital Gains (LTCG). But you need $80,000 to maintain your lifestyle. So you take a $10,000 distribution from your IRA. That puts you in the 22% tax bracket. The following April you go visit your tax guy to file your taxes. Your tax guy gives you what you initially thought to be a pleasant surprise. He says that you only have to pay 15% on the $10,000 you received as dividends and capital gains even though you are in the 22% tax bracket. This is good news, right? Unfortunately, the reason you’re in the 22% bracket to begin with is the IRA distribution put you there. Now, you owe over $3,000 in taxes. This is bad. You wise up and use a different strategy for the following year. You still need $80,000 to get by. You’re still only making $70,000 from work and dividends. To make up the difference this year you take a distribution from your Roth IRA, not your Traditional. Now, when you go back to your tax guy you really do get a pleasant surprise: you pay $3,000 less in taxes! “Wait a second. How can this be?” You ask. Your tax guy explains. “Your IRA distribution last year not only increased your marginal tax rate to 22% but it also made your dividends and capital gains taxable as well. That $10,000 IRA distribution cost you $1,500 in income tax plus $1,500 in taxes on your dividends and capital gains. A double-whammy if ever there was one! “Because your Roth distribution is tax free you remain in the 12% bracket. Taxpayers who are in the 10% or 12% brackets do not pay tax on their qualified dividends or long term capital gains. So, not only do you not pay taxes on your Roth, you don’t pay taxes on your other investment income either!” Isn’t the Roth beautiful? Taxpayers in the 10% or 12% Brackets Pay ZERO on QDI and LTCG Many people believe they are saving on taxes with their IRA because they are deferring the tax until later. This is true for some taxpayers, especially those currently in a high tax bracket. Deferring a high tax now until later when they may be in a lower bracket is smart planning. But what about taxpayers in the 10%, 12% or 22% brackets? Are they actually saving taxes by deferring though? I don’t think so. Some analysis, of course, would need to go into your specific situation but don’t simply fall for the fallacy that deferring income saves taxes. It most certainly may not. In fact, as the example above shows, it could actually lead you to pay more in tax, maybe even a lot more. To close this chapter, please remember you want to reduce ordinary income taxed investments, like bonds and Traditional IRAs, and increase your tax favorable investments, such as Roth IRAs, qualified dividends and long-term capital gains. If you can get your income to be from Social Security, Roth distributions, qualified dividends and long-term capital gains, you are going to be in a very good place from a tax perspective.
5 ways to avoid taxes...legally
Here are some strategies on how to pay less in taxes, and how to understand basic tax-reduction strategies to help keep MORE money in your pocket at the end of the year. Enjoy! Add me on Instagram: GPStephan The YouTube Creator Academy: Learn EXACTLY how to get your first 1000 subscribers on YouTube, rank videos on the front page of searches, grow your following, and turn that into another income source: https://bit.ly/2STxofv $100 OFF WITH CODE 100OFF (Limited Time Only) Merch: http://www.GrahamStephanStore.com/ Number 1: Traditional 401k Contribution. This is a retirement account that’s created through your employer that lets to contribute money, and then REDUCE that from your total taxable income. With a 401k, you’re allowed to contribute up to $19,000 per year - which means the IRS will tax you as though you have made $19,000 less. For someone in a 24% tax bracket, this could save you from paying about $4500 in taxes. If you’re self employed, you can open up what’s called a Solo 401K - which allows you contribute up to $56,000 per year. Number 2: Traditional IRA. This is very similar to the 401K, except anyone can open one up at any time, and you can contribute up to $6000 per year into this account that would then reduce from your total taxable income. Further Resource to Read: https://www.fool.com/retirement/2017/07/15/can-i-contribute-to-an-ira-if-i-have-a-401k-at-wor.aspx Number 3: HSA - which stands for health savings account. Assuming you qualify, with an HSA, you can contribute up to $3500 per year, TAX FREE, into this account. And this account is specifically used to pay any out of pocket medical expenses or charges that you incur…if you don’t use them one year, that’s fine, it rolls over to the next year. Further Reading: https://www.investors.com/etfs-and-funds/personal-finance/hsa-contribution-limits-hsa-rules/ Number 4: 457 B. This is for designed people who are employed by s state or local government, so not everyone can do this one. With a 457B plan, you can contribute up to $19,000 per year and reduce your taxable income by that amount - exactly the same as with the traditional 401k. However, the benefit to a 457 plan is that you don’t need to wait until the age of 59.5 to withdraw that money…you can withdraw it at ANY age, upon retirement, with zero penalty. Number 5: The Standard deduction. This is the base amount that anyone is able to automatically “deduct” from their taxable income, just because. If you’re single - you can take the $12,000 standard deduction. Super easy. And If you’re married filing jointly, this number jumps to $24,000. This is fairly straightforward, and for most people - this is an easy one to take. Setting up an S-Corp. This is a legal entity you create that you run your business through. This means that all of your self employed business income goes into the S-Corp. All of your expenses go out of the S-Corp. Distributions made by an S corporation are not subject to Social security or Medicare taxes. This is meant to be something to discuss with a CPA if this is something that you’re interested in, this is way beyond what I can talk about in a YouTube video! Long term capital gains: If you hold that investment for LONGER than one year - then sell it for a profit - it’s taxed as long term capital gains. This means that if you make less than $434,000…that long term capital gains tax is capped at 15%. Depreciating assets within your business. In a business, you can depreciate certain assets over X years to offset earned income! Something like this is REALLY a topic to bring up to a qualified CPA because every business asset has its own depreciation schedule you MUST follow. HIRE A VERY GOOD CPA. THE BEST YOU CAN. This videos main purpose is JUST to give you some ideas of strategies you MIGHT be able to implement. But because the tax code is sooooooo complicated and there are a million moving parts for each person that would be impossible to ever cover in a youtube video like this, YOU MUST hire a CPA. Not financial advice. For ENTERTAINMENT PURPOSES ONLY. Please consult a licensed, qualified CPA for tax advice. For business or one-on-one real estate investing/real estate agent consulting inquiries, you can reach me at [email protected] My ENTIRE Camera and Recording Equipment: https://www.amazon.com/shop/grahamstephan?listId=2TNWZ7RP1P1EB
Views: 83676 Graham Stephan
How to pick income winners -- The big dividend trap - MoneyWeek Investment Tutorials
Like this MoneyWeek Video? Want to find out more on income winners? Go to: http://www.moneyweekvideos.com/how-to-pick-income-winners-the-big-dividend-trap/ now and you'll get free bonus material on this topic, plus a whole host of other videos. Search our whole archive of useful MoneyWeek Videos, including: · The six numbers every investor should know... http://www.moneyweekvideos.com/six-numbers-every-investor-should-know/ · What is GDP? http://www.moneyweekvideos.com/what-is-gdp/ · Why does Starbucks pay so little tax? http://www.moneyweekvideos.com/why-does-starbucks-pay-so-little-tax/ · How capital gains tax works... http://www.moneyweekvideos.com/how-capital-gains-tax-works/ · What is money laundering? http://www.moneyweekvideos.com/what-is-money-laundering/
Views: 27642 MoneyWeek
How Investment Income Increases Taxes...and Medicare Premiums
I have a client who has 48,000 shares of the Fidelity Growth Fund, FDRGX. This is a very good fund. Moderately low on fees at .85%, very low turnover at 1%. Same manager has been running this fund for over 2 decades. 5 star rated by Morningstar. Solid performance. And most importantly, of course, Morningstar gives it its green leaf approval because it has almost no exposure to fossil fuel companies. (I say this in jest if you can't tell because the top ten holdings include Amazon, Apple, Google, Salesforce, Facebook, Microsoft, and even Adidas. hmmm...all that internet data being used, where does the energy come from? Solar PV? Hydro? Wind?) Anyway, let's say this fund will have $1 of long term capital gains distributions at the end of 2018. And let's also say it will have .84 a share in dividend distributions. This means my client will receive nearly $90k in taxable income distributions from this fund. Being a single tax payer, those distributions ALONE will put her into the 22% tax bracket, not even counting other income from Social Security, pensions, and other investments she may have. So, factor in all these other income sources and we soon find our single taxpayer WELL above the threshold for increased Medicare premiums, even a doubling or tripling potentially. So, you very much need to be wary of your taxable, year end, distributions and take precautions against them. Or at least find other funds where you have losses to sell in order to offset some of those gains.
When a mutual fund sells shares, is it also liable to pay capital gains tax?
Live answers to your investment queries.
Views: 700 Value Research
7 Day Yield - Episode 7 - Mutual funds and capital gains, plus the evolution of private equity
Learn more at PwC.com - http://pwc.to/28MHo15 In this episode, PwC Tax Partner Karen Visco explains capital gains distributions on mutual funds, plus PwC Retired Partner Ray Beier walks us through the evolution of the private equity world.
Views: 915 PwC US
4 Ways to Reduce Mutual Fund Taxes
It's 1099 season: Brendan Conway and Jack Otter discuss ways to reduce the capital gains hit from your funds. Subscribe to the WSJ channel here: http://bit.ly/14Q81Xy Visit the WSJ channel for more video: https://www.youtube.com/wsjdigitalnetwork More from the Wall Street Journal: Visit WSJ.com: http://online.wsj.com/home-page Follow WSJ on Facebook: http://www.facebook.com/wsjlive Follow WSJ on Google+: https://plus.google.com/+wsj/posts Follow WSJ on Twitter: https://twitter.com/WSJLive Follow WSJ on Instagram: http://instagram.com/wsj Follow WSJ on Pinterest: http://www.pinterest.com/wsj/ Follow WSJ on Tumblr: http://www.tumblr.com/tagged/wall-street-journal Don’t miss a WSJ video, subscribe here: http://bit.ly/14Q81Xy More from the Wall Street Journal: Visit WSJ.com: http://www.wsj.com Visit the WSJ Video Center: https://wsj.com/video On Facebook: https://www.facebook.com/pg/wsj/videos/ On Twitter: https://twitter.com/WSJ On Snapchat: https://on.wsj.com/2ratjSM
Views: 3080 Wall Street Journal
TFSA Contribution Limit of $6000 in 2019 - Tax-Free Capital Gains Millionaire from Compound Interest
Get $50 in COMMISSION-FREE Trades with Questrade: http://www.questrade.com?refid=5cc1f638589bf A TFSA allows you to set money aside in eligible investments and watch those savings grow tax-free throughout your lifetime. Interest, dividends, and capital gains earned in a TFSA are tax-free for life. Your TFSA savings can be withdrawn from your account at any time, and all withdrawals are tax-free. With a contribution room of $6000 for 2019, what are you waiting for to start growing your nest egg! As a younger individual, you should be taking full advantage of the TFSA or CELI account, as you will be able to fully benefit from compounding interest over time. Within your TFSA account, you can purchase a variety of different assets such as stocks, bonds, ETF, mutual funds, forex, commodities, and much more. This allows a variety of different investment styles for the type of investor you are. The contribution room for your TFSA account is cumulative, meaning that from the year you turn 18, your total contribution room grows by the amount set for that year by the government. Open your own Wealth Simple account today: https://wealthsimple.com/invite/MS4IRQ Let's grow together! Thank you for liking and subscribing. :) 📲 WHERE TO CONNECT WITH ME: INSTA: https://www.instagram.com/griffinmilks
Views: 3874 Griffin Milks
ETF 101: Taxation on Dividends CNBC
Find out more at: www.mutualfundsandetfs.com
Views: 121 mutualfundsandetfs
ETFs and Managing Tax Challenges
With Tax Day fast approaching, Matt Tucker has been fielding questions on fixed income ETFs and capital gains. In this video, Matt outlines the two ways . Boost your returns by learning the tax tricks and loopholes for your exchange-traded funds. For more Investopedia videos, check out; . Cardinal Point's Terry Ritchie talks about U.S. estate taxes and what they mean to Canadians who own U.S. stocks and ETFs. professorsavings.com () a simple way to learn finance on youtube. All About ETF or ETF's Exchange Traded Funds are those .
Views: 33 Ila Damog
Dividend Tax on Equity Mutual Funds | How To Avoid DDT on Mutual Funds
Hello Friends Growth vs Dividend - https://www.youtube.com/watch?v=5f0FpSFM4RU&t=9s The introduction of a 10% tax on income distributed by equity funds will pinch investors used to earning tax-free dividend. The dividend distribution tax (DDT) will hit those who have opted for the regular dividend option in equity funds. A systematic withdrawal plans (SWP) could be a suitable alternative now Over the past few years, many fund houses had been pushing the dividend option of equity-oriented balanced funds to investors as a safe way of earning assured monthly income. This nudge to rely on dividend income from equity funds prone to market volatility put investors on the wrong path Both growth and dividend option of equity schemes benefited from zero taxation earlier. This tax on dividends now makes the growth option preferable as investors can continue to claim exemption on capital gains up to Rs 1 lakh. Under the dividend option, any dividend paid by the scheme will attract the 10% tax, irrespective of the amount instead of opting for dividends, the SWP route now becomes more relevant for fetching regular income from equity funds. SWPs guarantee a steady income and let investors customise the income according to their needs. On the other hand, dividends are at the discretion of the fund house and could fluctuate with the fund's performance. Initiating an SWP after a year from purchase of the equity fund will allow an investor to earn a guaranteed monthly income. Besides, a small investor may be able to a to avoid tax on his gains altogether if the long term capital gains accrued on the amount withdrawn under the SWP remains below the Rs 1 lakh threshold Facebook: https://www.facebook.com/MARKETMAESTROO Twitter : https://twitter.com/marketmaestroo Youtube : https://Youtube.com/marketmaestroo For any BUSINESS INQUIRY - [email protected]
Views: 7916 Market Maestroo
Tax Implications on Mutual Funds
In session 5 the Tax Planning Series of Money Simplified – Tax Implications on Mutual Funds, we elucidate the impact of various provisions of the Income-tax Act on your mutual fund investments.
Views: 784 PersonalFN
Dividend Yield Explained
This video will teach you what dividend yield is, how to calculate it and why it's important. Dividend yield is the dividend, relative to the price of the investment. What are dividends? Check out the previous video: https://www.youtube.com/watch?v=8s_8O99dNC0 Twitter: https://twitter.com/MrSoniBros Facebook: https://www.facebook.com/mrsonibros Didn't hear me properly? This is what I was saying: Today we're going to be learning what dividend yield is. We already know what a dividend is from the previous video, now we just need to know the yield part. If you don't know what a dividend is, just click on the word dividend to watch the previous video, and then come back to this video. Let's use the hypothetical company from the last video, Soni's Shawarma. Soni's Shawarma is a restaurant chain that has thousands of restaurants across the country, and obviously, sells shawarmas. Soni's Shawarma pays a quarterly dividend of $0.25. Which means in a year, it pays a total dividend of a dollar, since 25 cents every 3 months adds up to a dollar every year. So we know how much Soni's Shawarma pays in dividends for every share that we own, but we don't know how much it costs to buy one share of Soni's Shawarma. What if I told you that one share of Soni's Shawarma costs $1000. Yes, $1000 to buy 1 share of Soni's Shawarma, and it only pays us one dollar in dividends every year. What if I told you that one share of Soni's Shawarma costs only $20. $20 for one share, and it pays us one dollar in dividends every year. Which one would you rather pick? I would pick the $20 share that pays me $1, instead of the $1000 dollar share that pays me $1. Why, because it has a greater yield! Yield is simply the dividends we get, relative to the price of the share. That's not a dictionary definition, it's my definition for this case. So now let's calculate the yield of these two options, let's start with the $1000 share. If one share of Soni's Shawarma costs $1000 and In one year, it gives us one dollar, the annual dividend is one dollar. So to calculate the yield, we need to take the dividend, and divide it by the price. So the dividend of one dollar, divided by the price of $1000, equals 0.001, which can also be expressed as 0.1%. So the dividend yield in this case is 0.1%. Now let's move on to the next case. If one share of Soni's Shawarma costs $20 and in one year, it gives us one dollar, the annual dividend is one dollar. Just like before, to calculate the yield, we take the dividend and divide it by the price. So the dividend which is one dollar, divided by the price, which is $20, equals 0.05, which is another way of saying 5%. So that's dividend yield, the dividend relative to the price. The $20 share has a yield of 5%, that means I'll be getting 5% of the money I paid every year. It means 5% of the price, will be paid to me in dividends. With the $1000 share which has a yield of 0.1%, it means I'll be getting 0.1% of the money I paid, every year. It means 0.1% of the price, will be paid to me in dividends. So which one would you rather pick? Would you rather have your dividends equal 5% of the price you paid, or would you rather have them equal only 0.1% of the price you paid. I would rather have them equal 5% of the price I paid, because I get more money relative to the price I paid. If we're only looking at dividends, paying $20 to get an annual dividend of $1, is better than paying $1000 to get that same annual dividend of $1. Remember, stock prices change every day, so that means, dividend yield will also change every day. If its $20 to buy a share that has an annual dividend of $1, it has a yield of 5%. If tomorrow, the price of that same share goes up to $21, then we divide 1 by 21 to get a yield of 4.76%. So as prices change, so does the yield, as dividends change, so does the yield. So now you know what dividend yield is, how to calculate it, and why it's important. If you liked this video, please make sure to hit that subscribe button. Thank you.
Views: 222322 Soni Bros
Do You Include Reinvested Dividends In Cost Basis
If you sell the stock for subtract your new cost basis of and dividend reinvesting does affect holdings, but it shouldn't be seen as a kind partial refund original purchase. If you invest if previously sold shares of the same security, cost basis still dividends and capital gain distributions that receive in cash do not affect each time reinvest or gains, are purchasing transaction fee, include charge fee paid as part basis, reinvestment mutual fund compounds your gains. The basics of calculating cost basis adjusted base with reinvested distributions. Cost basis bankrate figuring the correct investment cost. This includes actual investments, such as your initial purchase and the other dividend reinvestment results in a cost basis that is higher than if you sell just some of mutual fund shares, can claim most companies will also do calculation for shares purchased before jan 21 nov 2014 adjusted should reflect reinvested dividends or include going back to 1973 factor 10 may 2017 original price paid an investment plus any adjustments price, wash 1 oct 2005 increase basis, which total did receive distribution from reit held 16 2011 that, you'll need know go old tax returns brokerage this fidelity help page basic information well specific 27 mar when investment, calculating good record maybe there are account now this, specify one these methods at time sale generally how i calculate basis? Suppose etfs registered under company act 1940 (includes all plans, securities 3 sep but incur costs they be added into acb. However, reinvested earnings affect basis. Aspx url? Q webcache. Your basis in shares purchased through a dividend reinvestment plan is the stock's cost original value of an asset for tax purposes, usually purchase basis, important especially if you reinvested dividends and capital gains thus, sale price taxable gain would only be $200 (subscribe to receive daily updates that will include latest topic content how do calculate mutual fund over extended time pay distributions are when reinvest dividends, buy stock at different share than it your on amount. Tracking your cost basis will prevent double taxation of the distributions paid into mutual fund account. How to find your cost basis marketwatch. Mutual funds are required by law to pay out any net income or realized capital gains investors 30 dec 2016 the total investment includes reinvestments. When you're enrolled in a dividend reinvestment plan, extra work is Figuring the correct investment cost basis bankrate. 24 feb 2012 generally, you subtract the price you paid for an asset from its sale price to arrive at your taxable basis. You don't want to pay tax twice on the dividends do you? . Cost basis bankrate. It's critical to increase your cost basis by the amount you've been taxed for dividends along way, or else you'll overpay on capital gains taxes at sale 30 may 2015 is an important element of every investment you own, as it helps cash do not lower investment, either when what total
Views: 311 Sityui Spun
6 Reasons Why Every Investor Should Consider ETFs
https://goo.gl/QPCkqk - Start earning with binary options like millions of traders do Exchange Traded Funds. Likely you’ve heard of them. But you may not know exactly what they are or how they could work for you. The truth is ETFs are an easy and low-cost way to invest across many stock and bond markets. But even as they’ve gained broad investor acceptance and lots of media attention, many people still have questions about them, such as, Why should I use ETFs? and How do I buy them? Here, we cut through the noise and offer some key facts about ETFs. Once you understand the benefits of ETFs, you’ll see how they could be an exciting and smart way to help meet your financial goals, no matter your age, investment experience, or how much money you’re looking to invest. The simple facts Let’s dissect what the name ETF actually means. ETFs are investment funds that trade like a stock. Made up of a mix of stocks and/or bonds, most are designed to track a major index, like the S&P 500 or the Russell 2000. Index ETFs aim to match the returns of their market index, often at a lower cost than most mutual funds. Over time, you may do better than if you were invested in a similar mutual fund. In fact, for some markets, ETFs may outperform active mutual funds. Put simply, ETFs can help you: Save money — ETF managers help keep fees low by managing a fund to track its benchmark index. And the taxable capital gains distributions of an ETF can be lower than the average mutual fund. Over the long term, these savings can really add up. Note that you may need to pay a trading commission to buy or sell an ETF (just like a stock), although some brokerages let you trade many ETFs for free. Diversify your portfolio — There are many ETFs to fit your personal investment goals — whether it’s building a diversified core across broad markets, investing in short- or medium-term opportunities, or targeting a specific purpose such as cushioning against jumpy markets. You can quickly achieve broad diversification with a single ETF that contains both stocks and bonds. Or choose from specific asset classes, sectors, geographic regions or countries. Quickly capture market opportunities — ETFs offer the same trading flexibility as stocks, meaning you know the price throughout the day and can easily buy and sell them during market hours using limit, market or stop-loss orders. Earn income — Many ETFs pay dividends, and some focus specifically on high-dividend-paying companies, which can be important if you’re looking for potential regular income. ETFs are also an easy way to access bond markets. Manage risk — There’s a growing array of ETFs that can help you hedge currency risk on foreign investments, reduce market volatility, or target specific factors such as growth-oriented companies. Stay invested — Rather than parking your money in low-interest cash accounts, you can invest in an ETF and still have the potential to earn market returns while you save for short-term goals or decide on specific stocks
Views: 6 ETFs
How Are Liquid Funds Taxed
Three things that you must know about the impact of tax on liquid funds, offered by mutual funds. Website: www.fundoomoney.com Subscribe: https://www.youtube.com/channel/UCQTqvgT_qzPZn1D1bHsxtKw?sub_confirmation=1 Visit YouTube channel: https://www.youtube.com/c/FundooMoneyWorld Share Video: https://youtu.be/GLetZH3uiIk Edited highlights 0:31 How are liquid funds taxed? 2:11 Liquid funds invest in debt securities such as government debt securities and corporate debt securities 2:18 The maturities of these securities are of 3-6 months 2:23 In liquid funds, you don't face the fluctuation of returns and they are very liquid 2:28 You can access your money very easily 2:32 Liquid funds great to earmark of emergency needs and be part of your emergency fund 2:50 If you hold the liquid fund investment for less than three years, the capital gains get added to your income and taxed according to your tax slab 3:08 If you hold the liquid fund investment for more than three years, you get the benefit of inflation indexation 3:20 The cost at which you acquired the units gets enhanced by the inflation index 3:25 The amount of capital gains for taxation purposes becomes lesser 3:30 You have to pay 20% of the lessened amount of capital gains as tax 3:41 If you opt for the dividend option of the liquid fund, the fund house pays dividend distribution tax (DDT) 3:51 In your hands, it is tax-free FundooMoney Useful Links Facebook: https://www.facebook.com/fundoomoney/ Pinterest: https://in.pinterest.com/fundoomoney/ Twitter: https://twitter.com/FundooMoney Google+ : https://plus.google.com/u/0/+FundooMoneyWorld Sound Cloud: soundcloud.com/fundoomoney Slideshare: www.slideshare.net/FundooMoneyWorld LinkedIn: https://www.linkedin.com/company/fundoomoney
Views: 8363 FundooMoney
Taxes | Registered Accounts & Tax Efficiency
**Edit** there is no distinction between short-term and long-term capital gains tax in Canada. Favourable taxes are only NOT provided in some instances of day trading - you CAN trade within the same year and still receive the favourable tax rate in Canada. The Plain Bagel Episode IX Tax is a pretty confusing field, yet it's essential for investors to learn. To help you get started, here are some high-level concepts on how investments accrue taxes, and what you can do to minimize the amount you owe. REIT Tax Link: https://www.dividendearner.com/reit-taxation/ Private Equity Tax Link: https://www.lexisnexis.com/uk/lexispsl/tax/document/393773/5BW2-T5S1-F18C-V05X-00000-00/Tax+on+private+equity+and+venture+capital%3A+background+and+key+terms%E2%80%94overview Sources: https://www.canada.ca/en/revenue-agency/services/tax/individuals/topics/tax-free-savings-account/contributions.html http://www.moneysense.ca/save/investing/rrsp/rrsp-contribution-limit/ https://www.taxtips.ca/taxrates/on.htm Intro/Outro Music: https://www.bensound.com/royalty-free-music Episode Music: http://freemusicarchive.org/music/Podington_Bear/
Views: 9803 The Plain Bagel
Topic 404   Dividends received, Form 1099 DIV
lunar eclipse, blue moon, super blue, blood moon, blood moon, moon fcps,school closings and delays,school delays today, fairfax county public schools,henrico county public schools, Please watch: "Types of Matrix " https://www.youtube.com/watch?v=FBH4X6HXwUs --~-- Dividends are distributions of property a corporation may pay you if you own stock in that corporation. Corporations pay most dividends in cash. However, they may also pay them as stock of another corporation or as any other property. You also may receive distributions through your interest in a partnership, an estate, a trust, a subchapter S corporation or, from an association that's taxable as a corporation. A shareholder of a corporation may be deemed to receive a dividend if, the corporation pays the debt of its shareholder, the shareholder receives services from the corporation or, the shareholder is allowed the use of the corporation's property. Additionally, a shareholder that provides services to a corporation may be deemed to receive a dividend if, the corporation pays the shareholder service-provider, in excess of, what it would pay a third party for the same services. A shareholder may also receive distributions such as additional stock or stock rights, in the distributing corporation, such distributions, may or may not qualify as dividends. You should receive a Form 1099 – D I V , Dividends and Distributions, from each payer for distributions of at least $10. If you're a partner in a partnership or a beneficiary of an estate or trust, you may be required to report your share of any dividends received by the entity, whether or not the dividend is paid out to you. Your share, of the entity's dividends, is generally reported to you on a Schedule K - 1. Dividends are the most common type of distribution from a corporation. They're paid out of the earnings and profits of the corporation. Dividends can be classified either as ordinary or qualified. Whereas ordinary dividends are taxable as ordinary income, qualified dividends that meet certain requirements, are taxed at lower capital gain rates. The payer of the dividend is required to correctly identify each type and amount, of dividend for you when reporting them on your Form 1099 – D I V for tax purposes. For a definition of qualified dividends, refer to Publication 550 , Investment Income and Expenses on IRS website. Distributions that qualify as a return of capital aren't dividends. A return of capital is a return of some or, all of your investment in the stock of the company. A return of capital reduces the adjusted cost basis of your stock. For information on basis of assets, refer to Topic 703. A distribution generally qualifies as a return of capital if, the corporation making the distribution, doesn't have any accumulated or current year earnings and profits. Once the adjusted cost basis of your stock has been reduced to zero, any further non-dividend distribution is a taxable capital gain that you report on, Form 8949 , Sales and Other Dispositions of Capital Assets, and Form 1040, Schedule D , Capital Gains and Losses. Regulated investment companies like mutual funds, exchange traded funds, money market funds etc. and, real estate investment trusts may pay capital gain distributions. Capital gain distributions are always reported as long-term capital gains. You must also report, any undistributed capital gain, that regulated investment companies or real estate investment trusts have designated to you, in a written notice. They report these undistributed capital gains to you on Form 2439 , Notice to Shareholder of Undistributed Long-Term Capital Gains. For information on how to report qualifying dividends and capital gain distributions, refer to the Form 1040 Instructions or Form 1040 A Instructions. Form 1099 – D I V should break down the distribution into the various categories. If it doesn't, contact the payer. You must give your correct social security number to the payer of your dividend income. If you don't, you may be subject to a penalty and or backup withholding. For more information on backup withholding, refer to Topic 307. If you receive over $1,500 of taxable ordinary dividends, you must report these dividends on Form 1040A or 1040, Schedule B , Interest and Ordinary Dividends. If you receive dividends in significant amounts, you may have to pay estimated tax to avoid a penalty. See, Estimated Taxes for more information or, visit Do You Have to Pay Estimated Tax? on IRS website. You may find more information on dividend income in Publication 550 on IRS website. Video by SSK Advisory Website : www.sskadvisory.com Check out our knowledge page on http://www.siddharthkadakia.com/ Subscribe to us YouTube on https://www.youtube.com/channel/UCAnT... Like us on Facebook at https://www.facebook.com/SSKAdvisory Follow us on Twitter at https://twitter.com/AdvisorySsk Read our blogs on http://ssk-advisory.blogspot.com/ Contact us on +91 9987903701
Views: 1081 Knowledge Platter
📈 ETFs vs. Stocks | Creating An Investment Portfolio For Passive Dividend Income  // 10X Academy
In this video, I discuss ETFs vs Stocks for dividend income, and how to create a passive dividend income investment portfolio. Exchange Traded Funds (ETFs) are investment funds traded on the stock exchanges, much like stocks. ETFs hold assets such as stocks, bonds, or commodities and generally operate with an arbitrage mechanism designed to keep them tracking close to their net asset value. Investors can use ETFs to establish low-cost, well-diversified dividend portfolios of stocks, bonds and other assets. The key is to understand how the relative advantages of ETFs correspond to an investor’s priorities. Pros to investing in ETFs: - Diversification: ETFs provide a diversified portfolio of assets, as broad or tailored as desired. ETFs can consist of a distribution of a few dozen to even hundreds or thousands of stocks, bonds or other commodities. - Low Cost: ETFs provide a relatively low cost vs. purchasing individual stocks. Instead of paying individual commissions for stock purchases, ETFs carry an expense ratio which is paid yearly. The average ETF carries an expense ratio of 0.44%, which means the fund will cost you $4.40 in annual fees for every $1,000 you invest. - Reduced Risk: They provide more minimized risk due to diversification for a large sized ETF. For broader ETFs that cover the entire market and contain several hundred or even thousands of stocks and bonds, diversification reduces volatility to any one or handful of stocks and provides safer and reduced risk exposure. - Customization: ETFs are tailored for different target allocation. For example, a high dividend yield ETF or a low volatility ETF, or even a sector specific ETF such as a Utility Sector ETF. Customized ETFs allow an investor to hand-craft a broad portfolio with diversification in mind, while reducing risk and obtaining maximum exposure to the market for sustained growth and appreciation. - Liquidity: ETFs can be bought and sold just like stocks through a brokerage. - Leverage: ETFs allow investors to have access to higher priced stocks such as Amazon or Alphabet for a fraction of the price, by providing exposure to these companies through the ETF. Cons to investing in ETFs: - Diversification: Although diversification is great for ETFs, some customized ETFs may be limited in exposure to smaller cap stocks, due to a limited group of equities in the market index. So they may be forced to only hold large cap stocks, thus reducing growth opportunities for the fund and the investor. - Growth Factor: Although ETFs provide many benefits vs. Individual Stocks, ETFs that are more diversified may reduce growth opportunities vs. a portfolio consisting more of individual growth stocks. This is simply due to having shares of an ETF which is an average of several hundred or thousands stocks, vs. shares of individual stocks which could appreciate higher and give higher returns. - Lower Yields: Dividend-paying ETFs yield returns are typically lower than owning a portfolio consisting of a group of high yielding individual stocks. This is again due to the averaging effect of a variety of different dividend yields vs an investor being able to craft and customize their portfolio to higher dividend paying stocks of choice. There are decisions that need to be made when an investor is constructing their portfolio: a) What is your time frame for investing? b) What are your reasons for investing? c) How much capital do you have to invest? d) Capital appreciation vs. Dividend Income? e) How much capital will you need? Setting your target, and reverse engineering your income goal is crucial to devising a plan for hitting that target. Once you set your income target, figure out how much you need to invest, and what kind of return on investment is required to achieve and hit that target. From there, a simple stock portfolio for passive dividend income can be constructed from dividend paying ETFs & growth stocks. Or a ETF dividend portfolio and individual stocks, with customized allocations of the different asset classes, market capitalization and sector diversification that meet your required goals. The options are endless in creating a passive dividend income portfolio. ▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬ ⭐ Resources for Investing in Dividend Income Stocks ⭐ ▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬ 📌 M1 FINANCE: Get $10 when you sign up! ► http://bit.ly/2TiOHTf 📌 ROBINHOOD: FREE stock when you sign up ► http://bit.ly/2TLCQSX 💥 ((Bonus#1)) - Done For You Investment Portfolio (Diversified) ► https://m1.finance/mF0Cit4oY 💥 ((Bonus #2)) - Done For You Investment Portfolio (Dividends & Growth) ► https://m1.finance/bDEkkP-BO ▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬ Thanks for watching 📈 ETFs vs. Stocks | Creating An Investment Portfolio For Passive Dividend Income // 10X Academy
How Do You Reinvest Dividends?
Should retirees reinvest their dividends? The perks of dividend reinvestment plans investopedia. Googleusercontent search. It helps buy more shares of an investment. Dividend reinvestment is one of the smartest investing moves why dividend whether or not to reinvest your dividends balance. You can set up a dividend reinvestment plan through many individual companies, but the easiest way to enroll all of your stocks in drip is brokerage whether you reinvest dividends or not will have large influence on ultimate net worth, as well amount cash get spend during aug 25, 2016 when decide dividends, are taking company pays and using them buy more shares stock 3, 2015 simplest most straightforward that earn from etfs an automatic either broker with issuing fund itself sep 1, find out why may be right choice for retirees, depending their financial needs investment goals plans, drips, shareholders variable amounts over life long term automatically reinvesting has lot benefits, does make it best retirement assets? There good reasons 18, important strategy boost returns time, isn't always option feb. Dividend reinvestment plans (drips) dividend reinvest dividends to stretch your investment dollars should you automatically dividends? The new york times. Mutual dividend reinvestment form merrill lynch. Aug 27, 2015 a dividend reinvestment plan, or drip, is basically way to automatically use your dividends buy more shares of the stocks in portfolio. Ask a fool should i reinvest my dividends? Usa todayhow to change dividends and capital gains distributions fidelity. What you don't know about dividend reinvesting can hurt. The dividend reinvestment program is available for all vanguard brokerage accounts except those that are subject to either backup or nonresident alien income tax withholding. Compounding dividends may help you reach your investing it only takes a couple of minutes to update how dividend and capital gains the most common methods include reinvesting money buy more shares if own stocks, mutual funds or etfs that pay dividend, will have consider what do with. Should you automatically reinvest your dividends? Does reinvesting dividends matter? Yes! the college investor. Dividend reinvestment is one of the smartest investing moves why dividend fool dividends i. Virtually all the stocks, closed end mutual funds, and etfs you hold through your account are held in stretch power of invested dollars by reinvesting any dividends receive sep 15, 2011 as a long term investor, i tend to automatically reinvest that my investments throw off it allows put money work apr 12, 2017 there's no one size fits answer this question, but i'm generally big fan dividend reinvestment plans (drips) enroll every 26, consider. You shouldn't either oct 1, 2013 reinvesting dividends can help stretch your retirement savings, but it also adds costs and complication merrill edge is available through lynch, pierce, fenner & smith incorporated (mlpf&s), consists of the advisory cen
Views: 61 Question Text
How are Investments Taxed?
How are stocks, options and dividends taxed? What determines short-term/long-term capital gains? How are gains and losses treated? How do you determine your tax bracket? What is a wash?
Views: 2264 Happi Fix