Novel Investor • Page 13 of 13 • Compounding investing wisdom...

Happy Hour: Search For The Next Tech

March 28, 2014

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Jon

Welcome to the end of the week and another edition of Happy Hour! Just sit back, relax, and enjoy your end of the week roundup of all things interesting in the land of money.

Oculus Rift

There a big uproar this week with Facebook buying Oculus Rift, a virtual reality hardware company that began with funding on Kickstarter.

The Oculus kickstarters got exactly what they overpaid for…an expensive t-shirt. A few got a prototype too. The Oculus owners got $2 billion in cash and Facebook stock (which they might want to insure). Continue Reading…
Choose The Right Default Cost Basis Method

March 27, 2014

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Jon

Did you know you might be overpaying capital gains tax on investments because of tax rules that went into effect in 2011? Those new rules changed the way we report capital gains and losses on investments. Under the old rules, it was your job to report cost basis, that’s what you paid for the investment, to the IRS. With the new rules, it’s your broker’s or fund company’s responsibility.

Before the rules change, lets just say not everyone was truthful about their gains. The honor system doesn’t work well with taxes. Putting the onus into the brokers and fund companies’ hands add a layer of protection for the IRS.

Instead of number crunching your way to lower taxes at year’s end, you now need to calculate cost basis at the time of sale. That involves tracking your profits/losses, so you can pick the cost basis method that gives you the best tax savings for the year, without hurting you later on. Continue Reading…
Happy Hour: March Reminders

March 21, 2014

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Jon

Welcome to the end of the week and another edition of Happy Hour! Just sit back, relax, and enjoy your end of the week roundup of all things interesting in the land of money.

March Reminders

The hopes and dreams of a perfect $1 Billion Bracket is all but lost thanks to Dayton’s upset of Ohio St. That game knocked out 80% of the participants. Sadly, I was one of them. While you toil away tracking your NCAA brackets, here’s a few things you can do between games. Continue Reading…
Deciphering Form 1099-B

March 20, 2014

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Jon

One of the more confusing tax forms for investments is form 1099-B. Tax lingo is part of the cause. It’s like a foreign language at first sight. The tax code, and changes to it, cause the rest. It’s up to you to decipher what the 1099-B says.

Brokers and fund companies send form 1099-B when you buy or sell an investment, like shares of a mutual fund or stock. The form is a record of those transactions. When you plug the information into a Schedule D, you and the IRS can figure out your capital gains or losses for the tax year.

Of course, you owe taxes on capital gains, either short or long-term capital gains tax, based on how long you owned the investment. However, capital losses are used to offset gains or income and lower your tax bill. Continue Reading…
Happy Hour: Internet Turns 25

March 14, 2014

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Jon

Welcome to the end of the week and another edition of Happy Hour! Just sit back, relax, and enjoy your end of the week roundup of all things interesting in the land of money.

Happy Birthday Internet

I doubt anyone saw how big an impact the internet would have after 25 years. Maybe someone did and I wasn’t listening, because I was too busy playing with a new piece of computer hardware called a modem that you could hook up to your phone line. You could connect with a computer several states away in as long as it took to dial a phone. Continue Reading…
Easy Tax Equivalent Yield Formula and Chart

March 13, 2014

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Jon

There are many investments that offer tax advantages to investors. Tax free bonds, like municipal bonds, are one popular choice for high income earners and retirees. That idea of not having to pay taxes on investment earnings will always get attention, but are you getting the best return on your money? To find out, you need the tax equivalent yield on a tax-free bond to know whether it offers a better return than a taxable bond.

Given the choice between a taxable and tax-free bond or bond fund with the same amount of risk, credit quality, and maturity, it’s easy to pick the one with the higher yield. In this case, there’s one problem. It is an apples to oranges comparison. Continue Reading…

Happy Hour: Search For The Next Tech

Oculus Rift

Choose The Right Default Cost Basis Method

Happy Hour: March Reminders

March Reminders

Deciphering Form 1099-B

Happy Hour: Internet Turns 25

Happy Birthday Internet

Easy Tax Equivalent Yield Formula and Chart