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☆ Gen Z, millennial retail investors are tapping into ETFs, report finds. Here are things to watch out for, expert say
▼ + stars: | 2024-11-18 | by ( Ana Teresa Solá | ) www.cnbc.com time to read: +3 min

The survey polled 2,000 U.S. retail ETF investors in March. "The continued growth of retail investors investing in ETFs is certainly not going away," she said. watch nowMeanwhile, associated fees with ETFs tend to be much lower compared to mutual funds and other index funds. Index ETFs have a 0.44% average annual fee, half the 0.88% fee for index mutual funds, according to Morningstar. Similarly, active ETFs carry a 0.63% average fee, versus 1.02% for actively managed mutual funds, Morningstar data shows.

Persons: Oscar Wong, John Healy, Healy, He's, Young, Zers, Gen, Alison Hennessy, Hennessy, Tommy Lucas, Moisand Fitzgerald Tamayo, Lucas Organizations: Nasdaq, millennials, Morningstar Locations: New York City, U.S, Orlando , Florida

☆ Here's when exchange-traded funds really flex their ‘tax magic’ for investors
▼ + stars: | 2024-10-22 | by ( Greg Iacurci | ) www.cnbc.com time to read: +4 min

Christopher Grigat | Moment | Getty ImagesInvestors can generally reduce their tax losses in a portfolio by using exchange-traded funds over mutual funds, experts said. "You'll have tax efficiency that a standard mutual fund is not going to be able to achieve, hands down," he said. The same concept applies within a mutual fund: Mutual fund managers generate capital gains when they sell holdings within the fund. Large-cap and small-cap "core" stocks also "benefit considerably," with about 85% to 90% of their returns coming from capital gains, Armour said. However, there are instances in which passively managed funds can trade often, too, such as with so-called strategic beta funds, Armour said.

Persons: Christopher Grigat, Bryan Armour, Charlie Fitzgerald III, Moisand Fitzgerald Tamayo, Armour, It's, Morningstar, Fitzgerald, Bonds Organizations: North America, Mutual, Taxpayers, CNBC Locations: Orlando , Florida, U.S

☆ Your tax bracket may increase after 2025. Here's how it could affect your brokerage account
▼ + stars: | 2024-10-08 | by ( Kate Dore | Cfp | ) www.cnbc.com time to read: +3 min

Without action from Congress, trillions of tax breaks enacted by former President Donald Trump will expire after 2025, including lower federal income tax brackets, among other provisions. Higher rates after 2025 could impact some brokerage accounts since investors pay annual taxes on earnings, experts say. If you sell investments that you have owned for one year or less, the profits incur "short-term capital gains," or regular income taxes. Generally speaking, it's good to avoid short-term gains as much as you can. Actively managed mutual funds often trigger capital gains payouts, even when investors haven't sold shares, which can be a costly year-end surprise.

Persons: Donald Trump, Samantha Pahlow, Ferguson Wellman, Shea Abernethy, haven't, Abernethy, Tommy Lucas, Moisand Fitzgerald Tamayo Organizations: Ferguson, Ferguson Wellman Capital Management, Exchange, Investment Counselors Locations: Portland , Oregon, Winston, Salem , North Carolina, Orlando , Florida

If you're bracing for year-end mutual fund distributions, swapping assets for exchange-traded funds could sidestep the capital gains payout for 2024 and beyond. Some mutual funds distribute yearly capital gains to shareholders, typically in November and December. By comparison, most ETFs don't have an annual payout, which helps reduce ongoing taxes. Typically, investors incur capital gains when trading profitable mutual funds for ETFs in a brokerage account. Depending on their income, certain investors can "capital gain harvest" — strategically selling profitable assets while in a lower tax bracket — to swap mutual funds for ETFs, said Tommy Lucas, a certified financial planner and enrolled agent at Moisand Fitzgerald Tamayo in Orlando, Florida.

Persons: Tommy Lucas, Moisand Fitzgerald Tamayo Locations: Orlando , Florida

☆ Is the U.S. stock market too ‘concentrated’? Here’s what to know
▼ + stars: | 2024-07-01 | by ( Greg Iacurci | ) www.cnbc.com time to read: +6 min

David Paul Morris/Bloomberg via Getty ImagesThe U.S. stock market has become dominated by about a handful of companies in recent years. Some experts question whether that "concentrated" market puts investors at risk, though others think such fears are likely overblown. The so-called "Magnificent Seven" — Apple , Amazon , Alphabet , Meta , Microsoft , Nvidia and Tesla — make up about 31% of the index, it said. Why stock concentration may not be a concernThe S&P 500 tracks stock prices of the 500 largest publicly traded companies. When there were big market crashes, they generally don't appear to have been associated with stock concentration, he added.

Persons: Jensen Huang, David Paul Morris, Morgan Stanley, Charlie Fitzgerald III, John Rekenthaler, Rekenthaler, Elroy Dimson, Paul Marsh, Mike Staunton, We've, Goldman Sachs, Fitzgerald, Moisand Fitzgerald Tamayo, Charlie Fitzgerald Organizations: Nvidia Corp, Blackwell, Nvidia, Technology, Bloomberg, Getty, Microsoft, Tesla, U.S, Finance, Morningstar, Big U.S, Goldman, Goldman Sachs Research Locations: Orlando , Florida, U.S, Switzerland, France, Australia, Germany, South Korea, United Kingdom, Taiwan, Canada

☆ You could lose money by maxing out your 401(k) plan early — unless it has this special feature
▼ + stars: | 2024-06-05 | by ( Kate Dore | Cfp | ) www.cnbc.com time to read: +1 min

But you can lose money by maxing out your 401(k) too early in the year — unless the plan has a special feature. Most 401(k) plans offer an employer match, which uses a formula to deposit extra money into the account, based on your deferrals. Typically, you must contribute at least a certain percentage of income each paycheck to receive the year's full employer match. However, some 401(k) plans offer a "true-up," or additional deposit of the remaining employer match, for employees who max out contributions before the end of the year. It's typically most common in bigger plans, experts say.

Persons: maxing, Tommy Lucas, Moisand Fitzgerald Tamayo Organizations: Finance, Investor, America's Locations: Orlando , Florida

☆ This 401(k) match change could have 'unintended consequences' at tax time, experts say
▼ + stars: | 2024-05-03 | by ( Kate Dore | Cfp | ) www.cnbc.com time to read: +1 min

If you've opted into your employer's Roth 401(k) after-tax matching contributions this year, it could trigger a tax surprise without proper planning, experts say. Enacted in 2022, Secure 2.0 ushered in sweeping changes for retirement savers, including the option for employers to offer 401(k) matches in Roth accounts. Previously Roth 401(k) matches went into pretax accounts. However, those new matching Roth contributions could have "unintended consequences" at tax time, according to Tommy Lucas, a certified financial planner and enrolled agent at Moisand Fitzgerald Tamayo in Orlando, Florida. More from Personal Finance:IRS aims to more than double its audit rate on wealthiest taxpayersHere are three ways to lower your credit card annual percentage rate, experts sayWhy your financial advisor may not give you the best Social Security advice

Persons: you've, Roth, Tommy Lucas, Moisand Fitzgerald Tamayo Organizations: of America, Finance Locations: Orlando , Florida

☆ This simple move 'takes minutes' to file a free federal tax extension, tax pro says — here’s what to know
▼ + stars: | 2024-04-10 | by ( Kate Dore | Cfp | ) www.cnbc.com time to read: +1 min

If you need more time for your taxes, there's a quick, free way to file a federal tax extension online, according to experts. Luckily, filing for a federal tax extension "takes minutes," according to Tommy Lucas, a certified financial planner and enrolled agent at Moisand Fitzgerald Tamayo in Orlando, Florida. But you have through that due date to file an extension, which pushes the deadline by six months to Oct. 15. Some taxpayers already have a federal extension due to natural disaster declarations. Without the extension, your balance triggers the failure to file penalty, which is worth 5% of your unpaid taxes per month or partial month, capped at 25%.

Persons: there's, Tommy Lucas, Moisand Fitzgerald Tamayo Organizations: Finance Locations: Orlando , Florida

☆ What Biden's new student loan forgiveness plan means for your taxes
▼ + stars: | 2024-04-09 | by ( Kate Dore | Cfp | ) www.cnbc.com time to read: +2 min

US President Joe Biden speaks about student loan relief at Madison College in Madison, Wisconsin, on April 8, 2024. Andrew Caballero-reynolds | AFP | Getty ImagesTax treatment of student loan forgivenessStudent loan forgiveness is federally tax-free through 2025 — thanks to a provision from the American Rescue Plan Act of 2021. But the future taxability of student loan forgiveness is unclear. Many states have conformed to federal rules on the taxability of student loan forgiveness. Depending on your situation, higher income from taxable student loan forgiveness could cause "a chain of [tax] consequences," such as phaseouts for other tax breaks, Lucas said.

Persons: Joe Biden, Andrew Caballero, reynolds, Biden, Tommy Lucas, Moisand Fitzgerald Tamayo, Lucas, that's, Ethan Miller, isn't, Miller Organizations: Madison College, AFP, Getty, American, Planning, Progress, D.C Locations: Madison , Wisconsin, Orlando , Florida, Washington

☆ These are the proposed changes to the child tax credit — and how much you could get
▼ + stars: | 2024-01-24 | by ( Kate Dore | Cfp | ) www.cnbc.com time to read: +3 min

Kate_sept2004 | E+ | Getty ImagesHouse lawmakers on Friday advanced a $78 billion bipartisan tax package, which includes temporary child tax credit changes that could affect millions of families this filing season. The plan temporarily expands access to the child tax credit with retroactive changes. Here's what to know about the proposed changes to the child tax credit as the opening of tax season, on Jan. 29, quickly approaches. How the child tax credit worksCurrently, the child tax credit is worth up to $2,000 per qualifying child under age 17 for 2023 and reduces your taxes on a dollar-for-dollar basis. How much the child tax credit could increaseIf enacted, the bipartisan tax bill would make several temporary changes to the child tax credit that could benefit the lowest-earning Americans, according to the Urban-Brookings Tax Policy Center.

Persons: Tommy Lucas, Moisand Fitzgerald Tamayo, Lucas, Chuck Marr Organizations: Getty Images, Urban, Brookings Tax, Center, Budget Locations: Orlando , Florida

However, you may still owe taxes if you made a profit on resold Taylor Swift tickets, experts say. While third-party payment apps won't report as many business transactions to the agency this year, you are still required to pay taxes on profits, including resold concert tickets. "The big thing this past year was selling Taylor Swift concert tickets," said certified financial planner Tommy Lucas, an enrolled agent at Moisand Fitzgerald Tamayo in Orlando, Florida. 'If you want to follow the law ... report it'Ticket profits have always been taxable, and this may affect those who resold Taylor Swift concert tickets this summer. Keep copies of your purchase receipts for goods you later resell, such as those Taylor Swift tickets, since tax liability will be based on your sales proceeds minus the original purchase price.

Persons: Taylor Swift, Buda Mendes, tas23, Tommy Lucas, Moisand Fitzgerald Tamayo, Swift, Taylor, Lucas, James Guarino, Baker Newman Noyes, it's, Albert Campo Organizations: Getty, IRS, PayPal, TicketMaster, Accounting Services, CNBC Locations: Orlando , Florida, Boston, New Jersey

☆ Watch for this 'phantom tax' before taking Affordable Care Act insurance subsidies, advisor says
▼ + stars: | 2023-11-16 | by ( Kate Dore | Cfp | ) www.cnbc.com time to read: +2 min

d3sign | Moment | Getty ImagesAs millions of Americans compare health plans on the Affordable Care Act insurance marketplaces, experts say it's critical to run projections and rethink popular tax moves before enrolling in subsidies. The average enrollee is paying premiums of $124 per month after the subsidies, which were boosted through 2025 via the Inflation Reduction Act. If your actual income exceeds your estimates, you might be required to repay some or all of the subsidy. "If your actual income exceeds your estimates, you might be required to repay some or all of the subsidy." The subsidy eligibility calculation also considers your location, family size and whether you spouse has available coverage.

Persons: Tommy Lucas, Moisand Fitzgerald Tamayo, Lucas, Sean Lovison Organizations: Affordable, American, Center of Budget, Security, Philadelphia Locations: Orlando , Florida

☆ Here's how much you can make in 2024 and still pay 0% capital gains taxes
▼ + stars: | 2023-11-14 | by ( Kate Dore | Cfp | ) www.cnbc.com time to read: +2 min

The IRS on Thursday released dozens of inflation adjustments for 2024, including higher income tax brackets, increased standard deductions and boosted income thresholds for capital gains. For 2024, there are higher thresholds for the 0%, 15% and 20% long-term capital gains brackets, applying to assets owned for more than one year. How to calculate your capital gains tax bracketYou're more likely to fall into the 0% capital gains bracket in 2024 with higher standard deductions and capital gains income thresholds. "It's really quite a bit of capital gains you can receive without paying any tax," said certified public accountant Tom Wheelwright, CEO of WealthAbility. Who may fall into the 0% capital gains bracket

Persons: Tommy Lucas, Moisand Fitzgerald Tamayo, Lucas, Tom Wheelwright Organizations: IRS Locations: Orlando , Florida

☆ 3 things you can learn about taxes from San Francisco 49ers' Arik Armstead's paycheck
▼ + stars: | 2023-11-06 | by ( Kate Dore | Cfp | ) www.cnbc.com time to read: +3 min

Arik Armstead of the San Francisco 49ers at the NFC Championship game against the Philadelphia Eagles on Jan. 29, 2023. While the pay stub showed gross earnings of more than $4 million year to date, experts say it holds lessons for everyday taxpayers. While it's possible to withhold less than you'll owe, you could risk underpayment penalties on top of a sizable income tax bill in April. Max out your 401(k) to save on taxesIn addition to significant tax withholdings, Armstead also maxed out his workplace retirement plan for 2023. But you can reduce your adjusted gross income with pre-tax 401(k) contributions, experts say.

Persons: Arik Armstead, Kevin Sabitus, Sam, Armstead's, Albert Campo, Armstead, Tommy Lucas, Moisand Fitzgerald Tamayo, Lucas, Armstead's withholdings, John Loyd, Max Organizations: San Francisco 49ers, NFC, Philadelphia Eagles, Getty, Finance, Social Security, AJC Accounting Services, CFP Locations: Manalapan , New Jersey, California, Orlando , Florida, Florida, Texas, Fort Worth , Texas

Taylor Swift fans forked out an average $2,183 for a resold ticket to a concert on the superstar's Eras Tour, according to resale research site TicketIQ. Now, ticket resellers may owe taxes on profits made during what may turn to be — for them, at least — a rather "Cruel Summer." Ticket profits have always been taxable, but the new IRS reporting threshold for business transactions on third-party platforms, such as TicketMaster or eBay , is now a single payment of $600, down from 200 transactions worth an aggregate of over $20,000. Taxpayers will have to prepare as the law takes effect this coming season. "Starting at the beginning of next year, you want to make sure you know how to report this income," said certified financial planner and enrolled agent Tommy Lucas of Florida-based Moisand Fitzgerald Tamayo.

Persons: Taylor Swift, Tommy Lucas of, Moisand Fitzgerald Tamayo Organizations: TicketMaster, eBay, Taxpayers Locations: Tommy Lucas of Florida

☆ Investors should know these two risks: 'It's kind of like yin and yang,' says advisor
▼ + stars: | 2023-09-08 | by ( Greg Iacurci | ) www.cnbc.com time to read: +1 min

There are two kinds of risk that investors should understand when building a portfolio: risk tolerance and risk capacity. Safer assets, like cash or money market funds, are stable but have relatively low returns that may not deliver much if any growth after inflation. Risk tolerance is essentially an investor's comfort level with short-term market gyrations. It's a willingness to take risk and is personal, subjective and guided by emotion, experts said. Such a person would have a low risk tolerance.

Persons: Charlie Fitzgerald III, Fitzgerald, Moisand Fitzgerald Tamayo, It's Organizations: Finance Locations: Orlando , Florida

☆ There's no 'free lunch' with high-interest cash options, advisor says. How to plan for taxes
▼ + stars: | 2023-08-24 | by ( Kate Dore | Cfp | ) www.cnbc.com time to read: +1 min

Savers are now getting higher cash yields after several interest rate hikes from the Federal Reserve. "Everyone thinks it's kind of a free lunch," said Tommy Lucas, a certified financial planner and enrolled agent at Moisand Fitzgerald Tamayo in Orlando, Florida. Falling into the regular tax brackets, ordinary income is less favorable than long-term capital gains. Similarly, taxable money market funds — which typically invest in shorter-term lower-credit-risk debt — and Treasury bills also trigger ordinary income. But Treasury bill earnings aren't subject to state or local taxes.

Persons: Crane, Tommy Lucas, Moisand Fitzgerald Tamayo, you've Organizations: Federal Reserve, Crane Data, Finance Locations: Orlando , Florida

☆ The Mega Millions jackpot hits $1.55 billion. What's the best payout option? Experts weigh lump sum vs. annuity
▼ + stars: | 2023-08-07 | by ( Kate Dore | Cfp | ) www.cnbc.com time to read: +2 min

The Mega Millions jackpot hit a record $1.55 billion on Aug. 7, 2023. VIEW press | GettyThe Mega Millions jackpot has ballooned to an estimated $1.55 billion after months without a winner. If you pass away before collecting all 30 payments, Mega Millions will make the remaining payments on schedule to your designated beneficiary or your estate. Picking the lump sum payout is a 'big mistake'Andrew Stoltmann, a Chicago-based lawyer who has represented several lottery winners, says 95% choose the lump sum option, which he describes as a "big mistake." Tuesday's Mega Millions drawing comes about three weeks after a single ticket sold in California won Powerball's $1.08 billion jackpot.

Persons: Andrew Stoltmann, Tommy Lucas, Moisand Fitzgerald Tamayo Locations: Chicago, Orlando , Florida, California

☆ Mega Millions jackpot hits $1.05 billion. Here's the possible tax bill for the winner
▼ + stars: | 2023-07-31 | by ( Kate Dore | Cfp | ) www.cnbc.com time to read: +2 min

The Mega Millions jackpot soared to $1.05 billion on July 31, 2023. Shannon Stapleton | ReutersThe Mega Millions jackpot has soared to more than $1 billion for the fifth time in the game's history. Currently, the 30-year annuitized payout is worth $1.05 billion, Mega Millions' fourth-largest prize to date. The chance of hitting the Mega Millions jackpot is roughly 1 in 302 million. watch nowHow federal tax brackets workThe Mega Millions jackpot easily pushes the winner into the top federal income tax bracket, which is currently 37%.

Persons: Shannon Stapleton, Tommy Lucas, Moisand Fitzgerald Tamayo, Lucas, that's Organizations: Mega Locations: Orlando , Florida

☆ What 'Shark Week' can teach investors about a money 'survival instinct'
▼ + stars: | 2023-07-27 | by ( Greg Iacurci | ) www.cnbc.com time to read: +4 min

Aaronp/bauer-griffin | Gc Images | Getty ImagesIt's "Shark Week," the annual television-programming event on Discovery that stars the ocean's apex predators. Specifically, investors have a tendency to get swept away by the fear or euphoria of the recent past. This is called "recency bias," and it's often accompanied by financial loss. "People need to understand that recency bias is normal, and it's hard-wired," said Charlie Fitzgerald III, an Orlando, Florida-based certified financial planner. Investors are most vulnerable to recency bias, he said, when on the precipice of a major life change such as retirement, when market gyrations may seem especially scary.

Persons: bauer, Charlie Fitzgerald III, Steven Spielberg's, Omar Aguilar, Fitzgerald, I'm, Moisand Fitzgerald Tamayo, FOMO Here's, Aguilar, Christopher Polk Organizations: San Diego Convention Center, Aaronp, GameStop, Schwab Asset Management, Universal Studios Home Entertainment, Filmmagic, Getty, Finance Locations: Orlando , Florida

☆ Nearly 1.5 million taxpayers are 'leaving money on the table' as key tax deadline nears, advisor says
▼ + stars: | 2023-07-12 | by ( Kate Dore | Cfp | ) www.cnbc.com time to read: +1 min

There's a key tax deadline approaching for past-due filers, with an estimated $1.5 billion in unclaimed refunds up for grabs. Nearly 1.5 million taxpayers still have pending refunds from 2019, with a median payment worth $893, according to the IRS. The last chance to file or amend 2019 returns to claim your money is July 17. Filing 2019 returns could yield "thousands of dollars," Lucas said, especially for those claiming the so-called earned income tax credit, a tax break for low- to moderate-income workers. The earned income tax credit is "refundable" because you'll still qualify for a refund when the credit exceeds taxes owed.

Persons: Tommy Lucas, Moisand Fitzgerald Tamayo, Franklin, Lucas, you'll Organizations: Finance Locations: Orlando , Florida

☆ More taxpayers will receive tax forms from apps such as Venmo, PayPal for 2023. Here's how to avoid tax issues
▼ + stars: | 2023-05-23 | by ( Kate Dore | Cfp | ) www.cnbc.com time to read: +4 min

As a result of the change, more taxpayers are likely to receive Form 1099-K, which reports third-party business payments to the IRS. Some lawmakers are pushing to increase the reporting threshold, so it could change further. However, regardless of the tax reporting threshold, it's important to remember P2P business payments have always been taxable, experts say. Here are some additional tips to consider before the reporting change in January. An accounting system may also make it easier to track business expenses, which may be deducted to reduce taxable income, Guarino said.

Persons: Tommy Lucas, Moisand Fitzgerald Tamayo, Lucas, It's, Jim Guarino, Baker Newman Noyes, Guarino, Adam Markowitz, I've, Markowitz Organizations: Getty, Taxpayers, PayPal, eBay, IRS Locations: Orlando , Florida, Woburn , Massachusetts, Windermere , Florida

☆ Americans think gold beats stocks as a long-term investment. Advisors disagree: 'It's more like a speculation'
▼ + stars: | 2023-05-17 | by ( Greg Iacurci | ) www.cnbc.com time to read: +1 min

Twenty-six percent of Americans ranked gold as the best long-term investment in 2023, almost double the 15% who thought so in 2022, according to a recent Gallup poll. The share surpassed that of stocks: 18% of Americans ranked stocks as the top long-term holding, down from 24% last year, according to the survey. It was the first time since 2013 that their perception of stocks was below that of gold. "As a long-term investment, [gold] is a very poor solution," said Charlie Fitzgerald, a certified financial planner and principal of Moisand Fitzgerald Tamayo in Orlando, Florida. Stocks beat gold over the long term

☆ If you need more time for your tax return, do this today or 'miss the opportunity,' pro warns
▼ + stars: | 2023-04-18 | by ( Kate Dore | Cfp | ) www.cnbc.com time to read: +2 min

Getty ImagesThe federal tax deadline for most Americans is April 18, and there's still time to file for an extension. How to file a federal tax extensionThere are several ways to file a federal tax extension if you can't make the April 18 deadline. You can file Form 4868 electronically via IRS Free File, which provides free guided tax prep software. If you file Form 4868, it's very clear that you know exactly what you're doing. "If you file Form 4868, it's very clear that you know exactly what you're doing," said John Loyd, a CFP and owner at The Wealth Planner in Fort Worth, Texas.

☆ This tax move is a 'game changer' for freelancers and gig economy workers, advisor says
▼ + stars: | 2023-03-31 | by ( Kate Dore | Cfp | ) www.cnbc.com time to read: +1 min

If you're a freelancer or contract worker, there are still ways to lower your 2022 tax bill — including contributions to a retirement plan improved by legislation passed in December. One of the provisions from Secure 2.0 included a change to solo 401(k) plans, designed for self-employed workers (and possibly spouses) or business owners with no employees. Like standard 401(k) plans, there's a deduction for pretax solo 401(k) contributions. But since solo 401(k) account owners can make deposits as both the employee and employer, there's a chance to save more. Before 2022, you needed to open a solo 401(k) by Dec. 31 for current-year deposits.

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