LOOK INTO THE BENEFITS OF A SOLO 401(K) PLAN

Have you heard about solo 401(k) plans? The traditional type of 401(k) retirement plan is now available for self-employed individuals. And it lets you save more than other types of plans.

SHOULD YOU "ROBS" YOUR 401(K) TO START A NEW BUSINESS?

ROBS is an acronym for a relatively new financing arrangement known as a "rollover as business startup" being touted on the Internet and arranged by some investment firms. Is it a good option for your new business?

DO YOU OWE TAXES WHEN YOU GIVE A GIFT?

Some gifts are big, others are small, and the Internal Revenue Service expects you to report them all.
Or do they? Gift giving can be an important tax planning strategy. This year, a slowing economy might lead you to help family members with upcoming fall college bills or unexpected expenses. Now, before you write the checks, is a great opportunity to get a handle on the rules.

WHEN IS INCOME TAXABLE, AND WHEN IS IT NOT?

You only have to examine your paycheck to realize certain income is tax-free. For example, health insurance premiums paid by your employer are generally not includible in your income.

Do you know the tax status of other types of income? Here's a quiz to test your knowledge.

TAX TIPS FOR INDIVIDUALS SELLING THEIR HOME

The Internal Revenue Service has some important information to share with individuals who have sold or are about to sell their home. If you have a gain from the sale of your main home, you may qualify to exclude all or part of that gain from your income. Here are ten tips from the IRS to keep in mind when selling your home.

TAX-SAVING TIP: PUT YOUR INVESTMENTS IN THE RIGHT PLACE

To take best advantage of the lower long-term capital gains tax rates, investments that produce capital gains should be held in taxable accounts and those that produce interest income should be held in tax-deferred accounts (like your IRA or 401(k) plan). If you put capital gain investments in tax-deferred retirement accounts, you could turn income that would be taxed at lower rates into ordinary income taxed at higher rates.

USE TAX BREAKS TO CUT EDUCATION COSTS

As schools get back in session, it's a good time to check the education tax breaks for which you might qualify. First, there's the American Opportunity Tax Credit (formerly called the Hope credit) for a percentage of qualified expenses paid during the first four years of higher education. Second, the Lifetime Learning Credit allows a deduction for a percentage of qualified expenses paid for any year the American Opportunity Credit isn't claimed, and it even applies to job-related classes. Third, you may qualify for a deduction for interest paid on student loans. Fourth, education savings accounts allow annual nondeductible contributions for children under 18, with tax-free withdrawals for qualifying education expenses. Section 529 plans for college expenses should also be investigated.