Investing in Your Future EDWARD JONES
Time to gather your investment tax forms
The holidays are now a month behind us, which means it’s about time for another season: Tax Season. While you may not find it particularly festive, you can get through this season with a minimum of stress – if you’re organized. That means, among other things, you’ll need to gather the correct forms in one place. And right about now, you should be receiving many of the forms you’ll need – specifically, those tax forms related to your investments.
Here are some of the key forms to watch for:
1099-B – This form reports capital gains. A capital gain is an increase in the value of an investment over the initial purchase price. Short-term capital gains, on investments you’ve held for one year or less, are taxed at your ordinary income tax rate, while long-term capital gains, on investments you’ve held for more than one year, are taxed at 0%, 15% or 20%, depending on income. (Keep in mind that these figures are for the 2016 tax year.)
1099-DIV – This form reports the dividends you received from companies in which you invested. For most dividends, the tax rate is the same as it is for capital gains – 0%, 15% and 20%.
1099-INT – A 1099-INT reports the interest you received from bonds or cash instruments. Typically, most types of interest are taxed at your ordinary tax rate.
1099-R – A 1099-R form reports withdrawals from retirement accounts, such as your IRA and 401(k), along with payments you received from pensions and annuities.
1099-MISC – This form reports among other items, payments you might have received in lieu of dividends. 1099-MISC also reports earnings you might have received as an independent contractor.
1099-Q – If you contributed to a 529 plan or a Coverdell Education Savings Account (ESA), you may receive Form 1099-Q in each year you make withdrawals to pay school expenses of the beneficiary. However, the earnings in a 529 plan or Coverdell ESA grow tax free, and withdrawals are not taxable, as long as the money is used to pay for qualified higher education expenses.
Whether you do your taxes yourself or use a tax professional, you’ll want to become familiar with these forms. Not only are they necessary for filing your taxes, but they can also tell you something about how you invest. To cite one example, if you’re seeing a lot of taxes related to short-term capital gains – which are taxed at your personal tax rate, rather than the more favorable long-term rate – you may be doing too much trading. You might want to consider moving toward a strategy in which you buy quality investments and hold them for the long term.
Here’s something else to look at: the taxes resulting from your traditional IRA and 401(k) withdrawals. Could you possibly withdraw less from these accounts so that your taxes will be lower? Once you’re 70-1/2, you have to take at least a minimum amount, but other than that, you control the withdrawals – and you might benefit tax wise, by taking out only what you truly need.
So, gather up those 1099 forms for your tax returns – and for your own education as an investor.
This article was written by Edward Jones for use by your local Edward Jones Financial Advisor.
Edward Jones, its employees and financial advisors cannot provide tax or legal advice. You should consult your attorney or qualified tax advisor regarding your situation.
American Heart Month
Heart disease is still the leading cause of death for both men and women in the United States with an average of 600,000 Americans dying from heart disease every year.
Some people are at greater risk than others for a heart attack. It may be due to such uncontrollable factors as having a family history of heart disease or due to other diseases such as diabetes. Most of the risk factors, however, are lifestyle choices that can be changed. Those risk factors include leading a sedentary lifestyle, an unhealthy diet, being overweight/obese, and excessive alcohol use.
You can make healthy changes to lower your risk of developing heart disease. Controlling and preventing risk factors is also important for people who already have heart disease. To lower your risk: Watch your weight; Quit smoking and stay away from secondhand smoke; Control your cholesterol and blood pressure; If you drink alcohol, drink only in moderation; Get active and eat healthy.
Although not everyone has it, the most telltale sign of a heart attack is chest discomfort, which may feel like pressure, squeezing, or fullness. Pain may be felt in other areas, too, including one or both arms, neck, jaw, or stomach. Other warning signs include shortness of breath, cold sweat, nausea, light-headedness, or passing out. If you or someone you are with has one or more of these signs, do not wait – call 9-1-1 immediately.
Just a month into office, I have had yet another amazing honor bestowed upon me by House leadership. Speaker Tom Leonard has selected me to chair the House Appropriations Subcommittee on Higher Education.
Prior to term-limits, representatives did not usually receive chairmanships until after multiple terms in office, therefore, as a freshman legislator I view this selection as a tremendous honor and a responsibility that I will not take lightly.
But precedent is not the only reason I will take this position seriously.
As a teacher, I realize the value of a quality education and I believe every student has a right to access and receive that quality education. As chairwoman of Higher Education, I will work to ensure this is the case in our state.
As a mother of four with my oldest already in college, I understand the need for affordable tuition. As chairwoman, I promise to make college affordability a top priority.
In fact, I promise to go line-by-line over our near $1.6 billion Higher Education budget because I want to do everything within my power to ensure your hard-earned tax-dollars are spent efficiently. After all, college is expensive enough.
In addition to Higher Education, I received vice-chair positions on the Appropriations Subcommittee on General Government and on the Capitol Committee.
I welcome these early leadership roles because they afford me the ability to make a difference for our state right out of the gate.
Finally, in addition to serving on the full House Committee on Appropriations, I have also been selected to serve on the Appropriations subcommittees on Agriculture and Rural Development, and on Health and Human Services.
When I ran for office I did so with the expressed goals of helping our local community, ensuring public safety, and providing a positive future for our children and Michigan’s students.
My committee assignments have now put me in a unique position to make a tangible difference in those very areas.
I truly look forward to these next two years as your state representative.
Working across the aisle to make energy more affordable
Last week, the House of Representatives passed four bipartisan energy bills affecting electricity rates, security and safety alarms, updating some nuclear regulations, and providing exemptions for certain external power supplies. As Chairman of the Energy Subcommittee, I am proud to have worked on these important pieces of legislation. These are common-sense, bipartisan bills that will encourage job creation, increase accountability, and improve safety and affordability for consumers.
The first piece of legislation is H.R. 511, the Power and Security (PASS) Act, which would extend existing exemptions for security and life safety alarms from 2017 to 2023. It is virtually impossible for devices such as security alarms or smoke detectors that have to be continuously on to meet current Department of Energy (DOE) regulations because the regulations did not originally make accommodations for these “always on” products. This legislation would help protect both the jobs of those who make these products as well as the life and property of those who rely upon them. A nearly identical version of this bill passed in 2015.
The second piece of legislation is H.R. 587, the Fair RATES Act, which sets forth processes to set rates for electricity, including the opportunity for the public to protest a rate change filed with the Federal Energy Regulatory Commission (FERC). The legislation was advanced by the Energy and Commerce Committee during the 114th Congress by a voice vote and unanimously passed the House.
The third piece of legislation is H.R. 590, the Advanced Nuclear Technology Development Act of 2017, which will help American innovators and entrepreneurs develop and license advanced nuclear technologies by updating the regulatory framework to be more adaptive, technology-inclusive, and predictable. This bill ensures that the Nuclear Regulatory Commission (NRC) has the necessary expertise and resources to review and license new technologies and was advanced by the Energy and Commerce Committee during the 114th Congress with a voice vote unanimously passed by the House.
The final piece of legislation is H.R. 518, the EPS Improvement Act of 2017, which provides a carefully tailored solution to the problem manufacturers have faced trying to comply with DOE efficiency standards for external power supplies (EPS). The legislation carves out an exception for these devices, often found in certain types of ceiling fans and light-emitting diodes (LED) devices. The House advanced this bill in 2015.
As the new Congress gets underway, we will continue to advance solutions that ensure affordable energy for folks in Southwest Michigan and all American families. To learn more about this and other important legislative issues, please visit my website: upton.house.gov.
You’re invited to a Vietnam veterans event on Friday, Feb. 24
One of my greatest honors as your senator is taking part in tributes throughout Southwest Michigan to thank our veterans for their outstanding dedication. Although our Vietnam veterans served our country with honor, they were often forgotten when they retu