This is a sponsored post written by me on behalf of E*TRADE. All opinions are 100% mine.
One week from today is tax day. For some that day is more frightening than all the witches and ghosts on Halloween. Unlike most people, I don't mind paying taxes. It typically means that I made a good amount of money.
I do mind tediously putting all the numbers together. I'd rather face a vampire. I've watched enough Buffy the Vampire Slayer to feel like I know how deal with them (Roundhouse kicks always work).
Whichever way you feel about tax day, the E*TRADE Education Center is here to help. It's completely free and you don't even have to be an E*TRADE customer to use it. There's no sign-up or log-in.
I focused immediately on the Small Business Taxes section. That's the hairiest part of my taxes. However, you might be more interested in in this tax planning section:
If you happen to be an E*TRADE customer, you have access to the E*TRADE Tax Center. That center provides an array of tools and resources for customers, such as important information on everything from cost basis reporting and tips on managing capital gains and losses, to frequently asked tax questions.
Why is the Education Tax Center important?
E*TRADE conducted a recent StreetWise survey to find out what investors believed when it comes to taxes. It turns out that many investors heavily consider taxes, which I found relieving. Unfortunately the same survey found that most people don't use the tax tools available to them. That's something that E*Trade is looking to change.
What else was interesting? Some 45% most investors believed in putting money in tax-advantaged accounts such as IRAs, 401Ks, and Health Savings Accounts. I had expected more, but I generally over-estimate people's investment knowledge.
I found it surprising that 18% believed in selling positions that lost value to offset the capital gains, but only 17% believed in holding investments for a year to ensure lower taxes on gains. I would have thought the latter would be more well-known. Perhaps people weren't focused on the taxes on the gains because they are investing in tax-advantaged accounts.
One number that stood out to me that is that only 4% look to invest in funds with low turnover. At first glance that seems low to me. However, I usually look at the expense ratio in an ETF and use that as my proxy for all this information. Most of the high turnover is in managed funds, which I typically don't get involved with anyway.
The moral of the story, you don't have to like paying taxes, but you can make moves to lessen the bite of paying them. If someone is going to give you the tools for free, you might as well use them.
Next: The Power of Home Equity