The news flow and trading activity generally slow as we get deeper into the summer. That was not the case this week as investors had a myriad of new data points to analyze. The Federal Reserve’s Open Market Committee (FOMC), which sets the rate on the Fed funds, concluded its July meeting and, as expected, did not change its policy. Notably, the Fed also reiterated its commitment to using all tools necessary to support the economy. On the economic front, the Commerce Department reported second-quarter GDP, and it too was consistent with expectations. The economy posted its sharpest downturn on record, which was broad base, and can only be characterized as horrendous. Consumer spending was especially weak as services consumption fell 43.5% during the period.
will my retirement withdrawals be taxed by n.j.?
First, you are correct that Social Security benefits received are not taxable on your state return, while your pension plan distributions of $6,256 most likely are, said Cynthia Fusillo, a certified public accountant with Lassus Wherley, a subsidiary of Peapack-Gladstone Bank, in New Providence. Of course, your salary pre-retirement is taxable.
Fusillo said Thrift Savings Plan contributions are taxed when made. in other words, they are not salary deferrals for New Jersey tax purposes.
“Therefore, when you receive a distribution from your Thrift Savings Plan, that distribution will not be reportable on your New Jersey return since it’s already been taxed,” she said. “This is unlike a 401(k) plan which is a recognized salary deferral mechanism for New Jersey tax purposes.”
Investment Outlook | Second Quarter 2020: Eyes Wide Shut
A severe recession. Massive unemployment. A global pandemic infecting 13 million people. Populist uprisings in search of social justice. Trade disputes growing. Geopolitical tensions on the rise.
Companies abandon earnings guidance. Traders speculate in bankrupt companies. Oil producers commence a price war.
Not, seemingly, the ideal set-up for a major market rally. Especially one following immediately on the heels of a rapid, deep market plunge. Indeed, market participants had to shut their eyes to multiple concerns, to avert their eyes from a plethora of challenges threatening domestic and international political and economic stability.
can i use a 529 plan to pay for k-12 tuition?
529 plans are state-run plans that allow you to contribute tax-deferred dollars for college and university expenses, said Dawn Brown, a certified financial planner with Lassus Wherley, a subsidiary of Peapack-Gladstone Bank, in New Providence. She said the plans were created to be used to pay for tuition and other qualified expenses.
“The Tax Cuts and Jobs Act in 2017 expanded the use of 529 plans to include paying for tuition at an elementary or secondary school," Brown said. “It includes public, private and religious schools for K-12 students. A maximum of $10,000 can be withdrawn annually to pay for tuition.”