If you’re a business owner, professional, physician, or self-employed, and a high-earner, you may pay higher taxes than most Americans. Individual income taxes are the IRS’s biggest revenue source and the top 50% of all taxpayers paid 97% of the total income tax paid.[i] The good news is that there are some financial options that you may be able to take advantage of to lessen your taxes and keep more of your hard-earned money. In this article, we will go over some of the basics of the Defined Benefit Plan (DB), the Defined Contribution Plan (DC), and Cash Balance Pension Plans.
It may be hard to see sometimes, with the often apocalyptic 24-hour news cycles, but there is a lot of good out there in the world. One of the good things is how generous Americans have been with their charitable giving. Part of this widespread generosity is tied, no doubt, on the internet connecting people all over the world. Americans gave $410.02 billion dollars to charity in 2017, breaking a record and 70% of that was given by individuals.[i] As wealth grew, so too did charitable giving and generosity. Within that huge number, over $400 billion, some interesting patterns and data appear. Within this article, we will discuss why people practice charitable giving, who is giving, and how, if inclined, you could give more as well.
There are so many in need and for so many reasons. Between medical research, animal charities, environmental disaster, the refugee crisis, health crisis, homelessness, drug addiction, food instability, arts organizations, you name it, and there is a cause that could use the help. There is also solid evidence that your donations actually do make a difference to these causes. They do need and appreciate every penny they receive. But did you know that giving is actually good for you too? In fact, giving triggers a pleasure point in our brain, the same area of reward processing that is activated by pleasurable activities like sex and food.[ii] Donating our time and money to a cause makes us feel good, helps contribute to our overall happiness, and can actually help our health and mortality rates.[iii] On top of helping others and feeling good, charitable donations can be tax deductible, and for some, that is motivation enough. A good rule is before donating to anything you plan to claim, do your research and confirm that they are a recognized non-profit organization by the IRS and always get a receipt.