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☆ Millions of high earners pay this investment income tax every year. Here's how to avoid it
▼ + stars: | 2023-07-05 | by ( Kate Dore | Cfp | ) www.cnbc.com time to read: +1 min

Higher earners are more likely to owe an extra levy on investment earnings than a decade ago. Enacted as part of the Affordable Care Act health-care expansion, the 3.8% net investment income tax applies to capital gains, interest, dividends, rents and more once your so-called modified adjusted gross income, or MAGI, exceeds certain thresholds. MAGI can be higher than adjusted gross income because it adds back the foreign earned income exclusion. While dozens of tax code provisions adjust for inflation every year, the thresholds for net investment income tax have remained the same since 2013 — MAGI above $200,000 for single filers and $250,000 for married couples filing together. An estimated 7.3 million taxpayers paid nearly $60 billion in net investment income tax in 2021, compared with 3.1 million taxpayers paying $16.5 billion in 2013, according to the Congressional Research Service.

Persons: it's, It's, Brian Schultz, Plante Moran Organizations: Affordable, Finance, Congressional Research Service Locations: Southfield , Michigan

☆ Private equity risks gorging on its secret sauce
▼ + stars: | 2023-06-14 | by ( Liam Proud | ) www.reuters.com time to read: +7 min

Investors prefer pedestrian but steady management fees over the lumpy share of fund profit that is the industry’s special sauce. Private equity firms with a public listing funnel some of the carry to employees and some to shareholders. TPG (TPG.O) last year went public with a similar strategy of paying around two-thirds of performance-related revenue to employees. Assuming the general idea is to keep overall earnings steady, then higher fee-based income for shareholders must be matched by lower cash compensation for employees. It suggests that for KKR, TPG and the rest, there is a limit to just how much of their own secret sauce employees can eat.

Persons: Steve Schwarzman, Carlyle, Blackstone’s, Schwarzman, Henry Kravis, George Roberts, EQT, Blackstone, Harvey Schwartz, Rowe Price, Thoma Bravo, Jeffrey Goldfarb, Sharon Lam, Oliver Taslic Organizations: Reuters, Blackstone, KKR, Apollo Global Management, JPMorgan, Reuters Graphics, TPG, Apollo, Reuters Graphics Reuters, Alpha, Bain Capital, Thoma, Ares Management, Thomson Locations: BlackRock

☆ House Democrats, looking to renew plan to expand Social Security, say debt ceiling fight 'hurts seniors the most'
▼ + stars: | 2023-05-23 | by ( Lorie Konish | ) www.cnbc.com time to read: +4 min

Social Security already faces funding risksIn order to prevent a Social Security funding shortfall, congressional Democrats and Republicans must agree on a solution. The Social Security 2100 Act that was introduced in the last Congress had broad support among House Democrats. Changes in the Social Security 2100 Actzimmytws | iStock | Getty ImagesThe Social Security 2100 Act aims to extend the program's solvency, though estimates are not yet available for how long it could prolong the program's funding. Social Security 2100 also calls for adding an additional 12.4% net investment income tax for taxpayers making more than $400,000. Max Richtman president and CEO of the National Committee to Preserve Social Security and Medicare

☆ The actual impacts of A.I. on companies are still being figured out, says Wells Fargo's Bob Peck
▼ + stars: | 2023-05-18 | by ( ) www.cnbc.com time to read: 1 min

Share Share Article via Facebook Share Article via Twitter Share Article via LinkedIn Share Article via EmailThe actual impacts of A.I. on companies are still being figured out, says Wells Fargo's Bob PeckBob Peck, Wells Fargo chairman and co-head of global internet investment banking, joins 'Squawk on the Street' to discuss the overall social media environment, how generative A.I. impacts the social media space, and if Nvidia's A.I. aspirations are already priced into the stock.

☆ Biden's budget vs. House debt limit bill on spending, deficits, taxes
▼ + stars: | 2023-05-15 | by ( David Lawder | ) www.reuters.com time to read: +6 min

U.S. House of Representatives Speaker Kevin McCarthy and his fellow Republicans' "Limit Save and Grow Act" is a spending reduction bill that would cut 2024 federal discretionary spending to fiscal 2022 levels and rescind signature Biden programs already approved by Congress. Republicans: The House bill would cut 2024 U.S. discretionary spending back to the 2022 level of $1.664 trillion and limit subsequent annual increases to 1% for a decade. The discretionary spending proposals would add $2.23 trillion to deficits over 10 years, offset by tax increases. Biden: Full enactment of the fiscal 2024 budget request would reduce deficits by $2.857 trillion, according to the White House. Estimates for Biden's budget request are from the White House, as CBO has not yet issued a score.

☆ Insurer AIG exceeds profit estimates on strong underwriting gains
▼ + stars: | 2023-05-04 | by ( ) www.reuters.com time to read: +2 min

May 4 (Reuters) - American International Group Inc (AIG.N) beat market estimates for first-quarter profit on Thursday, as record underwriting gains cushioned the blow from lower alternative investment returns. AIG, one of the world's biggest commercial insurers, said net premiums written in its general insurance for the quarter ended March grew 5% to $6.97 billion. Total consolidated net investment income rose 9% to $3.5 billion, partially offset by lower alternative investment income, AIG said. The New York-based company's general insurance underwriting income rose 13% to $502 million, its strongest first-quarter underwriting results, the insurer said. The general insurance accident year combined ratio was 88.7%, compared with 89.5%, a year earlier.

☆ MetLife profit drops as economic worries hurt investment income
▼ + stars: | 2023-05-03 | by ( ) www.reuters.com time to read: +1 min

May 3 (Reuters) - MetLife Inc's (MET.N) first-quarter profit missed Wall street estimates on Wednesday as growing economic uncertainty hurt the insurer's investment income, sending its shares down 2% in extended trading. Adjusted net investment income fell 8% to $4.6 billion in a quarter marred by a string of high-profile bank collapses that roiled financial stocks. "We remain focused on managing risk across economic cycles and controlling what we can to deliver for our shareholders and our stakeholders," Khalaf said. Adjusted premiums, fees and other revenues - excluding pension risk transfers (PRT) at MetLife - rose 3% to $11.54 billion. Rival insurer Prudential Financial Inc (PRU.N) had reported a lower-than-expected quarterly profit on Tuesday due to a decline in its assets under management.

☆ Meet Kim Posnett, the powerful Goldman Sachs dealmaker who was just named head of the investment bank's TMT unit
▼ + stars: | 2023-05-03 | by ( Reed Alexander | ) www.businessinsider.com time to read: +10 min

Kim Posnett was just named head of Goldman's all-important TMT investment banking group. Posnett, 43, has long been one of the most senior figures at Goldman's investment bank. Posnett was previously the head of Goldman's investment-banking services unit, which acts as a salesforce for the global IB division. The former co-head of Goldman's TMT franchise will become co-chairman of the unit. The former would result in the IB services group, which functions, in effect, as a sales force.

☆ Goldman Sachs is making a slew of leadership changes in its investment bank. See the key moves here.
▼ + stars: | 2023-05-03 | by ( Carter Johnson | ) www.businessinsider.com time to read: +3 min

Goldman has internally announced a slew of leadership changes in its investment bank. Goldman's Aasem Khalil will take on Posnett's role as global head of investment banking services. A fresh face will now lead one of Wall Street's most powerful investment banking groups. She ultimately served as co-COO of TMT and head of Internet investment banking before being appointed head of investment banking services. Succeeding Posnett as head of global investment banking services is Aasem Khalil, a Goldman partner and 26-year veteran of the Wall Street bank.

☆ The Biden tax proposals that could hit baby boomer, family businesses
▼ + stars: | 2023-04-29 | by ( Cheryl Winokur Munk | ) www.cnbc.com time to read: +7 min

President Joe Biden's 2024 budget proposals contain several proposals that could hit small businesses right where it hurts — their wallets. Here are five provisions business owners should be aware of in President Biden's budget:A higher capital gains tax rate would be bad for business sellers. Biden is proposing that the corporate tax rate be increased to 28% from 21%. The majority of small businesses are pass-through businesses that are not subject to the corporate income tax, but for companies that are, the increase would be meaningful, tax experts said. Biden's proposal would increase the 3.8% net investment income tax rate on small business income over $400,000 to 5%.

ORLANDO, Florida, April 28 (Reuters) - With the U.S. debt ceiling crisis set to reach boiling point between June and August, it already promises to be a long hot summer for financial markets. - and inflation is high, while history shows the U.S. Congress certainly has the ability to push debt ceiling negotiations to the brink. "Markets are fundamentally intolerant of tightening liquidity conditions, and you could see this confluence of tightening liquidity where the debt ceiling and YCC come together," said Alex Lennard, investment director at Ruffer LLP. Default fears could suck more money out of bills and into safer parts of the money market universe like the Fed's RRP, exacerbating broader market liquidity conditions. Related columns:- 'Peak Fed' aggravates U.S. debt ceiling strains- Inequality and 'deposit glut' sowed bank instabilityBy Jamie McGeever; Editing by Andrea RicciOur Standards: The Thomson Reuters Trust Principles.

☆ TotalEnergies sheds Canadian oil sands, promises to reward shareholders
▼ + stars: | 2023-04-27 | by ( America Hernandez | ) www.reuters.com time to read: +2 min

TotalEnergies said its first-quarter adjusted net income fell 27% to $6.5 billion - in line with analyst expectations - due to lower energy prices. It also confirmed it expected net investments of $16-18 billion this year, including $5 billion for low-carbon energies. After European refining capacity was hampered by French strikes in the first quarter, TotalEnergies anticipates its facilities will ramp back up above 80%. TotalEnergies' share price was down around 1% in early trade, in line with falls across the sector and relatively weak oil prices . Analysts said its results were positive, as was the sale of carbon intensive oil sands given investors' focus on lower carbon energy.

☆ TotalEnergies sheds Canadian oil sands, boosts output in lower-price environment
▼ + stars: | 2023-04-27 | by ( ) www.cnbc.com time to read: +1 min

TotalEnergies said its first-quarter adjusted net income fell 27% to $6.5 billion - in line with analyst expectations - due to lower oil and gas prices. French oil and gas major TotalEnergies said on Thursday it had accepted an offer to sell its carbon-heavy Canadian oil sands operations to Suncor Energy for $4.1 billion, with potential additional payments of up to $450 million. TotalEnergies said its first-quarter adjusted net income fell 27% to $6.5 billion - in line with analyst expectations - due to lower oil and gas prices. It confirmed it expected net investments of $16-18 billion this year, including $5 billion for low-carbon energies. But the margins on refining diesel will drop as Chinese exports increase and Russian volumes find new global buyers.

☆ Insurer Travelers profit falls as costs from severe storms bite
▼ + stars: | 2023-04-19 | by ( ) www.reuters.com time to read: +2 min

April 19 (Reuters) - Property and casualty insurer Travelers Companies Inc (TRV.N) on Wednesday reported a fall in quarterly profit, hurt by severe wind and hail storms in parts of the United States in March. The storms pushed up the insurer's catastrophe losses net of reinsurance to $535 million from $160 million a year earlier. Two U.S. lenders crumbled after a flight of deposits spiraled out of control last month, sparking a global crisis that shook investor confidence in the banking industry and rattled markets. The turbulence has since subsided after intervention by regulators, but analysts have warned the banking industry will suffer long-term repercussions. Travelers' profit was helped by a 4% rise in net investment income to $663 million.

☆ Insurer Travelers profit falls on U.S. storm costs
▼ + stars: | 2023-04-19 | by ( ) www.reuters.com time to read: +2 min

April 19 (Reuters) - Property and casualty insurer Travelers Companies Inc (TRV.N) on Wednesday reported a 6% fall in quarterly profit, hurt by severe wind and hail storms in parts of the United States in March. The storms pushed up the insurer's catastrophe losses net of reinsurance to $535 million from $160 million a year earlier. Two U.S. lenders crumbled after a flight of deposits spiraled out of control last month, sparking a global crisis that shook investor confidence in the banking industry and rattled markets. The turbulence has since subsided after intervention by regulators, but analysts have warned the banking industry will suffer long-term repercussions. Travelers' profit was helped in part by a 4% rise in net investment income to $663 million.

☆ $70 billion Los Angeles retirement plan says higher rates may 'change everything' and portfolio moves are coming
▼ + stars: | 2023-04-19 | by ( Eric Rosenbaum | ) www.cnbc.com time to read: +6 min

A year into the most significant period of Federal Reserve rate hikes in decades, you might think investors had already cemented their investment portfolio strategies for a higher interest rate world. According to LACERA's 2022 annual report, its investments were split between roughly $24 billion in public equities, $19 billion in bonds, $13 billion in private equity, $6 billion in real estate, $4 billion in hedge funds and $1 billion in real assets. Last year was the first in the prior three fiscal years that the pension fund's investment portfolio lost money. By contrast, investment returns of 25.2% in 2021 were far ahead of the 7% percent, which LACERA attributed to the strong performance from global equity and private equity assets. A shift to more fixed income among top investors will flow through to the "whole economy," Grabel said.

☆ Lloyd's of London swings to 2022 pre-tax loss
▼ + stars: | 2023-03-23 | by ( ) www.reuters.com time to read: 1 min

FRANKFURT, March 23 (Reuters) - Lloyd's of London (SOLYD.UL) swung to a pre-tax loss in 2022 and took writedowns on its fixed-income investments, it said on Thursday. The pre-tax loss was 800 million pounds ($982.56 million), compared with a profit of 2.3 billion pounds a year earlier. Rising interest rates have hit investments at many financial firms, and it posted a net investment loss of 3.1 billion pounds, compared with a 900 million pound profit in 2021. However, Lloyd's underwriting profit jumped 53% to 2.6 billion pounds. John Neal, CEO of Lloyd's, forecast 2023 premiums of 56 billion pounds, up from 46.7 billion in 2022, according to a statement.

☆ UK growth demands better-directed fiscal fireworks
▼ + stars: | 2023-03-13 | by ( Francesco Guerrera | ) www.reuters.com time to read: +7 min

As a former health minister, Hunt is familiar with the Hippocratic Oath’s principle of “first, do no harm.” That credo didn’t resonate with former finance minister Kwasi Kwarteng. The Institute for Fiscal Studies estimates that borrowing in the current financial year is running 31 billion pounds below the November forecast by the Office for Budget Responsibility (OBR), the UK’s independent fiscal watchdog. A further 6 billion pounds will freeze fuel duties, avoiding a 23% rise from April. In November, the OBR forecast that Downing Street would meet that goal with just 9.2 billion pounds to spare. That would still cost 11 billion pounds a year but would boost investment by 5% in the long run.

☆ Wells Fargo's Bob Peck breaks down the market
▼ + stars: | 2023-03-09 | by ( ) www.cnbc.com time to read: 1 min

Share Share Article via Facebook Share Article via Twitter Share Article via LinkedIn Share Article via EmailWells Fargo's Bob Peck breaks down the marketBob Peck, Wells Fargo chairman of global internet investment banking, joins 'Squawk on the Street' to discuss his thoughts on the market and more.

☆ Biden calls for tax on the wealthy to extend Medicare funding
▼ + stars: | 2023-03-08 | by ( Kate Dore | Cfp | ) www.cnbc.com time to read: +1 min

President Joe Biden delivers remarks on his plan to protect Americans access to affordable health care in Virginia Beach, Virginia, on Feb. 28, 2023. President Joe Biden this week called for higher taxes on wealthy Americans to boost Medicare as part of his 2024 budget, aiming to help fund the program for at least 25 years. The plan would increase the net investment income tax from 3.8% to 5% for earnings of more than $400,000, including regular income, capital gains and so-called pass-through business income, which flows to individual tax returns, according to the White House. Enacted through the Affordable Care Act, the net investment income tax currently applies to earnings above $200,000 for single filers and $250,000 for married couples filing together. "By asking those with the highest incomes to contribute modestly more, we can keep the Medicare program strong for decades to come."

☆ Biden proposes to raise taxes on high earners to avert Medicare funding crisis- WaPo
▼ + stars: | 2023-03-07 | by ( ) www.reuters.com time to read: 1 min

March 7 (Reuters) - The White House will propose raising taxes on people earning more than $400,000 and reduce what Medicare pays for prescription drugs in a bid to keep the program stable, the Washington Post reported on Tuesday. "The president's budget extends the life of the Medicare Trust Fund by at least 25 years," the report said citing the plan. The White House's proposal would raise the net investment income tax, created by the Affordable Care Act, from 3.8% to 5% for all Americans earning more than $400,000 per year, according to the report. The White House did not immediately respond to Reuters' request for comment. Reporting by Shivani Tanna in Bengaluru; Editing by Andrew Heavens and Christina FincherOur Standards: The Thomson Reuters Trust Principles.

☆ Foreign direct investment in Brazil posts best January in 5 years
▼ + stars: | 2023-02-24 | by ( ) www.reuters.com time to read: +1 min

BRASILIA, Feb 24 (Reuters) - Foreign direct investment in Brazil reached its highest level for January in five years, according to central bank data on Friday, continuing a trend of strong results since last year. FDI totaled $6.9 billion in January, best since 2018, when it reached $8.3 billion. Last year, FDI reached $90.6 billion, the highest annual figure in 10 years. Brazil's current account deficit was $8.8 billion in January, larger than the $8.2 billion shortfall forecast by economists. Central bank data also showed that investors made a net investment of $4.2 billion in Brazilian markets in January, including $1.9 billion inflows in stocks and $2.2 billion inflows in bonds.

☆ Insurer AIG profit shrinks as storm-related costs, weak investment returns hit
▼ + stars: | 2023-02-15 | by ( ) www.reuters.com time to read: +2 min

Last month, property and casualty insurer Travelers Companies Inc (TRV.N) also reported a slump in quarterly profit, due to losses arising from the winter storm. AIG's underwriting income climbed 27% to $635 million from $499 million a year earlier, while net premiums written in its general insurance business fell 6%. The general insurance accident year combined ratio improved to 88.4% from 89.8% a year earlier. The metric excludes catastrophe losses, and a ratio below 100 shows the insurer earns more from premiums than it pays out in claims. Reporting by Manya Saini in Bengaluru; Editing by Shinjini GanguliOur Standards: The Thomson Reuters Trust Principles.

☆ TotalEnergies net profits double to record $36.2 bln in 2022
▼ + stars: | 2023-02-08 | by ( ) www.reuters.com time to read: +1 min

PARIS, Feb 8 (Reuters) - French oil major TotalEnergies (TTEF.PA) posted a record net profit of $36.2 billion in 2022, double the previous year, joining in the sector's bumper earnings thanks to higher oil and gas prices since Russia invaded Ukraine. TotalEnergies' fourth-quarter adjusted net income was $7.6 billion, including a $4.1 billion impairment related to the deconsolidation of its stake in Russian gas firm Novatek (NVTK.MM). The net income for the last three months of the year was in line with analyst estimates in a consensus by Refinitiv and compared with $6.8 billion a year earlier, and $9.9 billion in the third quarter of 2022. The company said it expected net investments of $16-18 billion in 2023, including $5 billion for low-carbon energy. Reporting by America Hernandez and Benjamin Mallet, editing by Silvia Aloisi and Richard LoughOur Standards: The Thomson Reuters Trust Principles.

☆ White House economist Jared Bernstein defends Biden's billionaire tax outlined in State of the Union
▼ + stars: | 2023-02-08 | by ( Chelsey Cox | ) www.cnbc.com time to read: +2 min

A top White House economist defended tax proposals aimed at the wealthiest Americans outlined by President Joe Biden during his second State of the Union address. Bernstein also defended the president's tax rate on capital gains, which he initially proposed in 2021. The tax rate would apply to those earning over $1 million. "You called it a wealth tax on unrealized gains," Bernstein said of the capital gains tax proposal. "In fact, what it really is, or at least the way we see, it is a prepayment or withholding tax on future capital gains."

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