Clients can claim tax deductions on their investment expenses, such as fees for professional investment advice, accounting and legal fees related to investment activities and subscriptions to online investment publications, according to MarketWatch. However, they cannot deduct costs related to tax-exempt securities, trading commissions, and travel expenses from participation in investment conventions and seminars, as well as stockholder meetings. Deductible investment-related expenses can be claimed if the total amount is more tan 2% of the investor's adjusted gross income. -- MarketWatch
Roth IRA investors can withdraw their contributions from the account without paying any taxes and penalty even if they are below 59 1/2 at the time of withdrawal, according to Kiplinger. The five-year rule only applies to the account's earnings, which can be tapped only after all contributions have been withdrawn. The rule also applies for withdrawals of converted amounts, which will be tax-free and penalty-free if the amounts are withdrawn after the investors reach 59 1/2 or the five-year test has been met. – Kiplinger
Clients who contribute to a Roth and a regular 401(k) plans should adopt a strategy that will maximize the tax benefits of these plans and subsequently reduce their tax liability, according to Investopedia. One example: pre-retirees who want to reduce their taxable income and move to a lower tax bracket should contribute more to a 401(k) plan, since contributions are tax-deductible. --Investopedia
Students are entitled to tax breaks if they cover their tuition and other qualified education expenses using funds from their 529 plans, distributions from IRA and Coverdell Education Savings Account, according to The Christian Science Monitor. They are also eligible to claim the American Opportunity Credit and the Lifetime Learning Credit and business deduction if education is related to their employment. Students also enjoy tax savings if they qualify for the Education Savings Bond Program or received scholarship and fellowship grants. – The Christian Science Monitor
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