Advisory Blog
A tool to help make taxes less taxing

Timely insights on the issues that matter most to investors.

The views expressed in these posts are those of the authors and are current only through the date stated. These views are subject to change at any time based upon market or other conditions, and Eaton Vance disclaims any responsibility to update such views. These views may not be relied upon as investment advice and, because investment decisions for Eaton Vance are based on many factors, may not be relied upon as an indication of trading intent on behalf of any Eaton Vance fund. The discussion herein is general in nature and is provided for informational purposes only. There is no guarantee as to its accuracy or completeness. Past performance is no guarantee of future results.

  • All Posts
  • More
    Topics
      Authors
      The article below is presented as a single post. Click here to view all posts.

      By

      Boston - It's fair to say it has been a confusing tax season for many investors. Although the Tax Cuts and Jobs Act was passed in 2017, this is the first year that the changes will be reflected in tax filings.

      The new law, the first big overhaul of the tax code since 1986, created new tax brackets and raised the standard deduction for single and joint filers. However, there were also changes to itemized deductions and investment-related expenses that have made filing 2018 taxes tricky for many.

      For example, the Tax Cuts and Jobs Act placed a cap of $10,000 on state and local tax (SALT) deductions, which effectively raised investors' state tax rate. As a result, some investors are taking a closer look at municipal bonds as a way to potentially ease their tax burden.

      Also, raising the standard deduction has implications for deductions for charitable contributions. Although fewer taxpayers will itemize due to rising standard deductions, one way they can maximize their tax savings is to bundle several years' worth of charitable deductions into a single year.

      Putting it all together, this first tax season under the new law is a reminder that minimizing taxes is an important year-round activity for investors and their financial advisors.

      Using our Tax Calculator to make smarter investment decisions

      To help U.S. individual taxpayers and their advisors make smarter investment decisions by better understanding the investment taxes they pay, Eaton Vance recently launched an easy-to-use Investment Tax Calculator with newly enhanced features and functionality.

      Based on user inputs of income level, tax filing status and place of residence, the calculator determines the combined total tax rate -- including federal, state and local taxes -- that applies to an incremental dollar of the investor's ordinary investment income, in-state and out-of-state municipal bond and U.S. Treasury interest income, qualified dividend income, net realized long-term and short-term capital gains, and qualified retirement plan withdrawals.

      The calculator also includes tools enabling investors and advisors to readily compare the after-tax income of different types of fixed income investments and to evaluate the tax consequences of selling concentrated stock positions, taking into account the investor's individual tax circumstances. The Investment Tax Calculator is available to the general public on a free website accessible at eatonvance.com/mytaxrate.