Berkshire Financial Partners, LLC: Tax strategies to consider by Berkshire Financial Partners, LLC.

FOR IMMEDIATE RELEASE
(Free-Press-Release.com) April 7, 2010 -- Berkshire Financial Partners, LLC: Tax strategies to consider by Berkshire Financial Partners, LLC.
Tax season is the prime time of year to implement some smart tax deduction strategies. With minimal effort, you can still have a huge impact on your 2011 tax return by decreasing your realized income. If any of these strategies appeal to you, Berkshire Financial Partners, LLC recommends you speak with a tax adviser before the season begins.
Berkshire Financial Partners, LLC Strategy #1: Fund your Retirement:

By funding your retirement early on, you will be able to make tax deductible contributions to a traditional IRA up until the 2011 tax filing deadline for the 2011 tax year. The IRA allows a maximum amount of money for your retirement fund. For those 50 and over, the catch-up contribution brings you up to $22,000. Berkshire Financial Partners, LLC, goes on to explain that for IRA’s, the limit is set at $5,000, while the catch-up is $1,000 for both years. Check with your employer ASAP to see if it’s not too late to kick up your contributions.
Berkshire Financial Partners, LLC Strategy #2: Hold Off on the Roth IRA Conversion:
Owners of traditional IRAs can convert all or a part of their accounts to a Roth IRA if their 2011 modified adjusted gross income is under $100,000.

Berkshire Financial Partners, LLC, explains that any amount converted is taxable income, but is thereafter eligible for the potential tax-free distribution rules of Roth IRA’s. The big news is that starting in 2011, the $100,000 income threshold is removed – anyone can do a conversion. For 2011 only, you also have the option to spread the income from conversion over the following two years (2011 and 2012). Many have been waiting for this opportunity.
Berkshire Financial Partners, LLC Strategy #3: Sell Losing Investments (and Big Winners):

The S&P 500 index went from the low 900’s to a low of 666 in March, back up to a 2009 high of 1,119. That’s one heck of a volatile year. All in all, the market is up over 22% for the year, and could be this year as well. Depending on when you’ve bought and sold, you might want to consider unloading big winners to offset your losers, or big losers to offset your winners. First, you must subtract your losses from any capital gains you’ve made. Next, additional losses can offset up to $3,000 of your 2009 ordinary income.
Have larger net losses than $3,000? Losses above and beyond what you used to offset your capital gains and ordinary income, Berkshire points out, can be carried over into future tax years. Before implementing investment loss strategy by selling mutual funds, make sure that you won’t incur any penalty for holding shares for too short of a period of time.
Berkshire Financial Partners, LLC Strategy #4: Capital Gains Tax Cuts:

Under the Tax Increase Prevention and Reconciliation Act (TIPRA) of 2005, US taxpayers in the two lowest tax brackets (10% and 15%) will pay no capital gains taxes on long-term investments sold in 2009 and 2010. Long-term capital gains result from profit made via appreciation of a security (stock, fund, etc.) held for more than one year.
Berkshire Financial Partners, LLC Strategy #5: When you Donate to a 501(c)(3), Everyone Wins:
Keep in mind, tax deductions for charitable donations can be claimed for the year in which the donation is made. Perhaps it’s time to rummage through your house to find valuables you no longer need or want that others can gain value from. You may obtain fair market value on these items. Or, simply open your checkbook or donate cash.

Donations of $250 or more must come with a written receipt or letter from the 501(c)(3). When submitting your donation, ask for and keep all of the appropriate documentation and receipts associated with all donations so that you are safe in the event of a possible future tax audit. Berkshire Financial Partners suggests that if you are donating goods, document a description of everything given.
Berkshire Financial Partners, LLC Strategy #6: Prepay your January, 2010 Mortgage:
If you’re a homeowner, Berkshire Financial Partners believes you may want to consider making your January mortgage payment in December, which will give you one more month of interest to deduct from your 2011 taxes. Check with your mortgage provider to see if an early payment is possible. It may be a great way to offset extra income windfalls in 2011.
Berkshire Financial Partners, LLC Strategy #7: Get Healthy on your Medical Bills:

If you have large and predictable medical and/or dental bills that need to be paid, consider making all the payments before the year is over. Berkshire Financial Partners would like to inform you that the IRS allows families to itemize and deduct medical and dental expenses that exceed 7.5% of their adjusted gross income, so if you’re close to going over that percentage it may be wise to pay the bills to be able to make the
tax deduction.
It won’t affect your 2011 taxes (since it was already deducted), but don’t forget to use up the rest of your 2011 FSA funds if you are in danger of losing them in the New Year.

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