Pay Least Amount of Tax Legally Available, Advises CPA and Fee-only Wealth Manager Wayne B. Titus III during Detroit Free Press tax chat
Plymouth, Michigan (PRWEB) March 26, 2014 -- Michigan taxpayers took advantage of the free chat to get answers to their questions on topics ranging from child care tax credits and charitable contribution deductions to selling property at a loss and borrowing from 401(k) plans. Susan Tompor of the Detroit Free Press moderated the event, which included Lorena Bencsik, CPA, and IRS spokesperson Luis D. Garcia, in addition to Titus. Bencsik and Titus are both members of the Michigan Association of CPAs.
“The wide range of questions shows how complex the tax code can be for people,” Titus says. “My goal is to advise clients on what they are legally obligated to pay, while helping them with planning strategies to minimize their tax liability.”
Titus urges clients to take advantage of the tax savings available from traditional IRAs and Roth IRAs. Contributions to both plans can be made by April 15 for the 2013 tax year, and non-working spouses also are eligible to participate. Traditional IRA contributions are tax deductible, but are taxed later when withdrawn at retirement. Roth IRA contributions are not tax deductible, but are tax free when withdrawn.
For taxpayers whose incomes exceed the maximum allowed for a Roth IRA, Titus explains that a so-called “back-door Roth IRA” is an option. With this strategy, an individual who is eligible to make a non-deductible IRA contribution immediately converts the contribution to a Roth IRA account. The tax is paid at the time of the non-deductible IRA contribution; no tax is due on the conversion, and the money is tax free when withdrawn tax at retirement. “Specific IRS requirements must be met, so individuals should consult their CPA before proceeding,” Titus says.
Roth IRAs also can help taxpayers reduce exposure to the alternative minimum tax (AMT). “This strategy requires planning now to reap the benefits on next year’s tax return,” Titus says. “Your CPA can advise you on your specific tax situation.”
To replay the March 13 Detroit Free Press tax chat, go to http://bit.ly/1iuIBsg. Information on upcoming tax chats is at http://on.freep.com/1iUXG7i.
“As our tagline states, ‘From financial wisdom, better stewardship.SM',” Titus concludes. “The more you know about ways to reduce your taxes, the more money you will have to direct to the people and causes you care about most.”
AMDG Financial (http://www.amdgservices.com) is a fee-only fiduciary registered investment adviser (RIA) in Plymouth, Michigan. The firm manages approximately $66 million in assets for clients. AMDG Financial was one of the first 10 firms, globally, to be certified by the Center for Fiduciary Excellence (http://www.cefex.org) as following global best practices for investment adviser fiduciaries.
To contact the Michigan Association of CPAs, go to http://www.michcpa.org.
Wayne B. Titus lll, AMDG Financial, http://www.amdgservices.com, +1 (734) 737-0866, [email protected]
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