The Motley Fool

MAY 26, 2024

Image source: The Motley Fool/Upsplash At this point, the 2024 tax season is thankfully in many people's rearview mirrors. And hopefully, you've either gotten your tax refund already or are expecting it to arrive any day now. As of early May, the average tax refund issued this year was $2,864.

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The Motley Fool

DECEMBER 22, 2023

Not only do the holidays inspire goodwill and cheer, but many people are interested in writing off their donations as we close out the tax year. But there's also a lot of confusion about charitable donations and when you can write them off for tax purposes. To write off a charitable deduction, you'll need to itemize your tax return.

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The Motley Fool

MAY 29, 2024

There's nothing wrong with dipping your first toe in Wall Street's waters through a low-cost exchange-traded fund (ETF). What's an exchange-traded fund? An exchange-traded fund is a collection of securities that you can buy or sell through a brokerage firm on a stock exchange.

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The Motley Fool

JULY 24, 2024

Open an individual retirement account For many, Roth IRAs are the best thing since sliced bread because you can contribute after-tax dollars now in exchange for tax-free income later. This can be particularly rewarding if you expect to be in a higher tax bracket in the future and want to eliminate the worry of future taxes.

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The Motley Fool

SEPTEMBER 13, 2024

If you're a fan of exchange-traded funds, then you're also likely a fan of index investing. Indeed, the world's most-owned exchange-traded fund is the SPDR S&P 500 ETF Trust meant to mirror the world's best-known market barometer. What if, however, you're indexing wrong?

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The Motley Fool

DECEMBER 29, 2023

Exchange-traded funds, or ETFs, are a popular investment option that offer numerous benefits to investors. ETFs are collections of securities that trade on stock exchanges like individual stocks but track the performance of an underlying index, basket of securities, or commodity.

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The Motley Fool

SEPTEMBER 24, 2024

With that in mind, here are two exchange-traded funds (ETFs) that can give your portfolio exposure to Bitcoin and related companies without requiring you to buy the digital currency on an exchange or select individual Bitcoin-related stocks. The tax implications of this ETF can be far more straightforward.

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The Motley Fool

MARCH 25, 2024

The trick is to make your cash savings more tax-efficient. Here are two exchange-traded funds (ETFs) that use different tax strategies to offer better after-tax returns than savings accounts for some investors -- and without much additional risk. Treasuries is exempt from state income tax.

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The Motley Fool

MAY 24, 2024

Since individual retirement accounts (IRA) aren't tied to your employer, you'll have full control over the account and can invest in assets like exchange-traded funds and individual stocks to supercharge your investment portfolio. Let's say you are 25 years old and you contribute $7,000 to a Roth IRA every year.

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The Motley Fool

OCTOBER 14, 2024

With risk-free CDs, Treasury bills, and high-yield savings accounts paying yields around 5%, dividend-paying stocks and exchange-traded funds ( ETFs ) lost their luster. Continuously writing covered calls also isn't a tax-effective strategy because the seller books the premiums as capital gains with each options expiration.

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The Motley Fool

SEPTEMBER 2, 2024

Roth IRAs have a unique tax break you don't receive from popular accounts like 401(k) or traditional IRAs. They allow you to contribute money that's already been taxed and then take tax-free withdrawals in retirement, as long as you're 59 1/2 years old and made your first contribution at least five years ago.

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The Motley Fool

SEPTEMBER 30, 2024

For example, a Roth IRA offers exceptional tax benefits, making it an outstanding retirement planning tool. It also comes with immediate tax benefits. For example, taxes on 401(k) contributions are deferred until retirement, meaning you can lower your taxable income during your working years by contributing more to your 401(k).

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The Motley Fool

JUNE 19, 2024

Both offer excellent tax advantages. One of the drawbacks of 401(k)s, in the eyes of some investors, is that they tend to offer a limited menu of investment choices -- perhaps just a dozen or so mutual funds or exchange-traded funds (ETFs). Your taxable earnings shrink by $7,000, shrinking your tax bill.

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The Motley Fool

DECEMBER 2, 2023

The 401(k) is a cornerstone of retirement planning -- it's tax-friendly, hands-off, and convenient. Contributions to a traditional IRA may be deductible, and earnings grow tax-deferred until you take withdrawals in retirement. Contributions to a Roth IRA are made with after-tax money, and withdrawals are tax-free in retirement.

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The Motley Fool

AUGUST 13, 2023

You contribute after-tax dollars to a Roth IRA, but withdrawals are free in retirement if you meet other requirements. Money received can also be counted toward your annual income, increasing your tax bill. You don't have that problem with an IRA because you can invest in any single stock or exchange-traded fund your heart desires.

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The Motley Fool

MARCH 19, 2025

The stock market comes with a bewildering number of choices, including several thousand individual stocks and a similar number of exchange-traded funds (ETFs). Tax-efficient moves Uncle Sam will want a share of your gains at some point. Image source: Getty Images. Why the Vanguard S&P 500 ETF?

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The Motley Fool

JULY 29, 2023

You may be able to invest your money in different funds that align with your goals and risk tolerance. At the end of the year, you won't have to worry about a tax bill because the money in your account grows on a tax-free basis. That's when a Roth IRA can save the day, if you qualify.

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The Motley Fool

FEBRUARY 12, 2024

Saving money for retirement while simultaneously getting tax breaks is a 2-for-1 benefit that can work wonders for retirees. In a Roth IRA , your tax break comes in retirement. IRAs allow you to invest in virtually any stock or exchange-traded fund (ETF) you could in your regular brokerage account.

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The Motley Fool

SEPTEMBER 4, 2023

You also make contributions with pre-tax income. You can make tax-deductible contributions. Your contributions aren't tax deductible in the year you make them but you get to withdraw money tax-free as a retiree. There are also actively managed funds where you have to pay a high fee to a professional to pick assets.

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The Motley Fool

MAY 25, 2024

Maximize Roth IRA contributions Roth IRAs receive a lot of attention because they allow you to contribute after-tax dollars now in exchange for tax-free withdrawals in retirement. So, if you amass a million dollars in your Roth IRA, it will be 100% tax-free as long as you're 59 1/2 and have satisfied the five-year rule.

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The Motley Fool

JUNE 4, 2024

Exchange-traded funds (ETFs) are a great choice. In fact, tax laws can actually make capital gains a more attractive option for generating income. You can simply sell shares to generate income from these paper profits, possibly paying less in taxes due to preferential tax treatment on long-term capital gains.

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The Motley Fool

JANUARY 15, 2024

It's passive, there are employer matches, and it comes with tax breaks. In IRAs , you can invest in any individual stock or exchange-traded fund (ETF) that you could in a standard brokerage account (some have exceptions for higher-risk investments like options ). That said, I also believe a 401(k) can often be overrated.

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The Motley Fool

JULY 17, 2024

With tax-free growth and tax-free withdrawals in retirement, it separates itself from other accounts like 401(k)s and traditional IRAs (although those are great options, too). A 2% yield on $1 million worth of shares would pay you $20,000 annually, and since this would happen in a Roth IRA, it'd all be tax-free.

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The Motley Fool

OCTOBER 21, 2024

Enter Vanguard exchange-traded funds (ETFs), the brainchild of investing legend John Bogle. These funds typically boast lower turnover rates compared to actively managed alternatives, a characteristic that substantially reduces investors' tax liabilities. VOO data by YCharts Comprehensive U.S.

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The Motley Fool

FEBRUARY 9, 2024

With a traditional IRA or 401(k), you get a tax break on your contributions up to an annual IRS limit, which can change from one year to the next. If you put $5,000 into a brokerage account, you won't reap any tax benefits. But if you put that same $5,000 into an IRA, you won't pay taxes on $5,000 of your income.

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The Motley Fool

NOVEMBER 30, 2023

If you're saving for retirement but not using a retirement plan, you're missing out on valuable tax breaks that could help make your saving efforts more successful. Several different retirement plans allow you to take a tax deduction when you make contributions, including IRAs and 401(k)s. Either of these scenarios isn't very good.

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The Motley Fool

JULY 19, 2024

The IRA comes with tax incentives. For every dollar you contribute to a traditional IRA, you can deduct it from your tax return. Alternatively, you could contribute to a Roth IRA, pay taxes now, and you won't have to pay any taxes when you withdraw funds from the account in retirement.

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The Motley Fool

SEPTEMBER 22, 2024

With CD rates likely to fall, putting money in an S&P 500 ETF, or exchange-traded fund, looks a lot more appealing. An ETF is basically a basket of stocks that trades on a stock exchange as a single investment. If you follow certain rules, all your withdrawals from a Roth IRA will be tax free when you retire.

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The Motley Fool

NOVEMBER 18, 2024

Are S&P 500 index exchange-traded funds (ETFs) investors' best bets as the year draws to a close? In particular, the prospects of fewer regulations and corporate tax cuts are much higher now that the elections are over. Any way you look at it, the S&P 500 (SNPINDEX: ^GSPC) is absolutely crushing it these days.

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The Motley Fool

NOVEMBER 21, 2024

You contribute after-tax dollars -- hopefully when you're in a lower tax bracket -- and your withdrawals in retirement will be completely tax-free once you've reached 59 1/2 and met the five-year rule. A Roth IRA is the best thing since sliced bread for many folks. What makes it so special?

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The Motley Fool

DECEMBER 4, 2023

However, the best part is that it can likely be achieved with an S&P 500 exchange-traded fund (ETF) like the Vanguard S&P 500 ETF (NYSEMKT: VOO). There's an easy way to save thousands in taxes A Roth IRA is a retirement account that lets you contribute after-tax money and then take tax-free withdrawals in retirement.

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The Motley Fool

MARCH 7, 2024

A combination of optimism about the recent launch of Bitcoin exchange-traded funds (ETFs) and an upcoming halving of Bitcoin -- making it more difficult to mine the crypto -- are driving its price higher. ETF tax rules are already in place, while crypto tax rules are still confusing.

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The Motley Fool

JULY 14, 2024

Here's how I plan to retire as a millionaire and pay no taxes. Once it's open, you can contribute up to $7,000 in 2024, and the amount typically stays the same or rises every tax year. The beauty of that is you don't pay taxes on your distributions in retirement. So let's walk through this together.

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The Motley Fool

JULY 2, 2024

If your income is under a certain threshold , you can contribute after-tax dollars to a Roth IRA and receive tax-free income during retirement. Alternatively, you can contribute to a traditional IRA and potentially qualify for a tax break in the current year if you meet the eligibility criteria.

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The Motley Fool

AUGUST 25, 2023

Use tax-advantaged accounts Gifts from Uncle Sam can be few and far between, so when you have the chance, it's best to take advantage. Traditional IRAs allow you to deduct your contributions from your taxable income, depending on your income, tax filing status, and whether you're covered by a retirement plan at work.

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The Motley Fool

JUNE 7, 2024

Many employers offer retirement plans like a 401(k) to help you save in a tax-advantaged way. Plus, you can take advantage of tax-loss harvesting to help you reduce your tax bill. Make the most of your workplace benefits After you understand your numbers, explore your workplace benefits.

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The Motley Fool

APRIL 21, 2024

As with any tool, it is only as accurate as the assumptions it makes and the data it has, and should not be relied on as a substitute for a financial advisor or a tax professional. ETFs can make it simple to match long-term market returns All you need is a simple exchange-traded fund (ETF) tracking a solid market index with low annual fees.

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