The weather is getting crisp. The leaves are starting to change and the holiday decorations are starting to hit store shelves. Yep, it’s beginning to feel a lot like…tax season. As the year heads into its final months, Uncle Sam is licking his chops at the delicious tax revenue he’s looking to collect in the new year. For investors, the final few months are particularly critical when it comes to tax planning. It’s here that they can potentially reduce their current and future liabilities. And there are plenty of reasons to do just that. The effect of taxes can be a bigger determinant of your actual investment returns.
Luckily, dividends can help on the tax front and produce better after-tax returns for investors than other investment strategies. And you don’t have to be super wealthy to benefit from dividend tax planning. In fact, even those in lower brackets and Millennials just starting out in their careers can truly benefit in the short and long term.
All in all, the upcoming holiday season is also tax season. And it’s time to dig in and plan for the months ahead.
For more investment concepts, visit our Dividend Investing Ideas Center.
