Tag Archive for Savings Bonds

Non-business Capital Gains and Losses—Government Debt Securities

Harold Goedde

This article discusses debt securities issued by the federal government—treasury securities and savings bonds and non-taxable bonds issued by states and municipalities.

U.S. Treasury Bonds and Notes

Non-inflation adjusted securities. Read More

Written by | Posted in 2016 Tax update • Capital Gains • United States

Income Tax Aspects of Non-Business Capital Gains and Losses – Part V

Government Debt Securities

Interest on non-taxable bonds

The interest on most of these is not taxable but must be reported on the tax return. On form 1040 and 1040A, it is reported on line 8b (non taxable interest). On form 1040 EZ, on line 2, put “TEI” and then the amount, but do not include it in the amount reported for taxable interest on line 2. Exceptions (i.e., interest is taxable) are federally guaranteed obligations (there are some exceptions to these), revenue bonds used to finance home mortgages (there are some exceptions to these), and private activity bonds (there are some exceptions to Read More

Written by | Posted in Capital Gains • Income Tax

Tax Strategies For Education Savings

The cost of a college education is higher year after year, with no relief to increases in sight. The annual cost at an Ivy League school is over $60,000 a year; even state schools for in‑state students is over $20,000 in some locations. How can you manage to pay all or even some of the cost for yourself, your spouse, or your child? It isn’t easy, but tax incentives can help. Here are some tax‑advantaged strategies for education savings.

529 Plans

There are two types of state plans that can be used to save for higher education:

Tuition plan. Contributions pay a fixed amount of state school tuition (depending on the amount of contributions and the projected tuition).

Savings plan. Contributions are invested and available to pay qualified expenses on a tax‑free basis.

There are no income limits on contributors. The amount you add to the plan is up to you. However, states impose account limits, so no contributions can be made when the value of the account reaches a set limit (e.g., $350,000 per beneficiary in California’s plan; $375,000 in New York’s plan; $394,000 in Florida’s plan). Read More

Written by | Posted in Federal • Individual • Tax Education