I am a U.S. citizen working overseas and I take the Foreign Earned Income Exclusion. This leaves me with $0 taxable income. However, I would like to put my stock earnings into a tax free account. I have been told that I cannot put the money into an IRA. Are there any other options? My total stock earnings will not be more than $5000 in any given year.
2007-09-30 19:25:59 · 5 answers · asked by Anonymous in Business & Finance ➔ Taxes ➔ United States
If you have stock in a taxable account, any gain is taxable.
You could establish a Health Savings Account if you have a high deductible health insurance policy. This will allow you to deduct your contribution (which depends on your policy deductible) and not pay tax on distributions for health care.
Municipal bonds and an after-tax annuity will also be tax advantaged.
2007-10-01 01:51:07 · answer #1 · answered by ninasgramma 7 · 0⤊ 0⤋
Your stock earnings are fully taxable. They are not eligible earned income to contribute to an IRA or other tax preferential account. (Even if it was, you'd still have to pay tax on the earnings first.)
2007-09-30 23:16:45 · answer #2 · answered by Bostonian In MO 7 · 0⤊ 0⤋
placed the optimal quantity which will maximize what your employer places away for you. Then open up a ROTH ira with your monetary employer and placed the optimal allowed in there. A ROTH IRA is After Tax funds and because you do no longer make too lots besides ther'es no think approximately attempting to maintain funds with PRE TAX funds. The ROTH will enable that funds to strengthen and once you retire you could pull all that funds out without getting taxed on it. you will in spite of the undeniable fact that would desire to pay taxes on your 401k and a conventional IRA once you retire. you're particularly lots already interior the backside tax bracket, so putting away funds on your 401k won't save you lots. actual placed up on your employer will max out on because of fact it is loose funds.
2016-12-17 13:56:35 · answer #3 · answered by embrey 4 · 0⤊ 0⤋
Consider a tax free municipal bond mutual fund or a tax free money market fund or tax free municipal bonds in a school or community that you know back home.
Caution: Mutual Bond Fund prices do fluctuate. Your principle is NOT guaranteed.
2007-09-30 21:15:59 · answer #4 · answered by Jeff H 5 · 0⤊ 0⤋
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2015-02-07 11:29:26 · answer #5 · answered by Elwyn 1 · 0⤊ 0⤋