It's good news when the stock market goes up steadily for over five years*, but there is a downside—income taxes eventually need to be paid on those gains.
Massive market losses from 2007 to 2009 were carried forward by mutual funds and in individual portfolios. These neutralized the gains from the first few years of the recovery. For 2014, many mutual funds had large capital gains that were passed along to the fund investors.
The losses that have been carried over on personal tax returns may also be gone by now. Don’t be surprised if you pay more in taxes this year. However, know that it is better to pay more in taxes and have more money than to pay no taxes and have less money.
* At its last lowest point in May of 2009, the Standard and Poor’s 500 Index was at 700, down 55% from its high of 1,550 in October of 2007. As of the end of 2014, it was up 194% to 2,060. (Source: Yahoo Finance). It should be noted that if something decreases by half, it must double in value to get back to its starting point.
Art + Photos: In December, the Sacramento Art Complex (2110 K Street Gallery) closed and was converted to co-op office space. This is the space I had been showing my photos for the last year. It is a shame to lose another Midtown art gallery. As of today, I have no photos on display on Second Saturdays. I'm hoping to have a larger Internet presence within the next month or two.
Writing: A story I wrote about my son, Ross, is included in the recently published Chicken Soup for the Soul book about Hope and Miracles.
Tuesday, January 27, 2015
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