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Do Your Tax Deductions Include Investment Activities?

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  • January 4, 2019

If your tax deductions don’t include investment activities, you may be missing out on considerable opportunities. Though tax season is not a favorite season for most, one thing worth celebrating is that you may have investment tax deductions you haven’t accounted for. This blog posts intends to inspire our clients to consider potential tax deduction opportunities that can help reduce your tax burden come filing time.

Publications

You may be surprised to hear this but did you know that expenses accrued when purchasing your favorite publications might be tax deductible? All of that leafing through the Financial Times can also serve you come filing time so be sure to keep some of your receipts. It may seem nominal but we don’t think this is worth brushing aside.

Safe Deposit Box Rental

Some of our clients keep certain investments, such as savings bonds, in a safe deposit box rental at your bank. The rental cost of that safety deposit box may be tax-deductible.

Interest Tied to Investing

Though this is a very strictly managed deduction, it’s possible that the IRS may allow you a deduction for interest fees accrued through your investing initiatives. Before you get too excited, let’s clarify that commissions are not directly tax-deductible but other fees or advisory charges might be. Notably, your net investment income determines the cap on the margin interest expense that is eligible for a write-off.

Advisory Fees

While stockbroker commissions are not tax-deductible, it’s worth noting that certain investment advisory fees might be. To be clear, the nuanced rules surrounding advisory fee deduction eligibility need to be closely assessed to determine whether the fees being considered are tax-deductible.

Ultimately, unique determinants tied only to your situation will help determine what tax deductions you are eligible for. When considering some of the more nuanced tax deductions we’ve mentioned, it’s worth consulting with an experienced tax professional.

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