Disagrees With Tax Planning Tip

BY COOK

I do not agree with the recommendation to pay IRA fees out of separate funds stated in “Tax Planning Tips for 2000 and Beyond,” ( JofA, Nov.99, page 10). What percentage of taxpayers gets any tax benefit from miscellaneous deductions subject to the 2% rule?

If the fee is paid out of IRA funds, you do lose the tax deferred earnings on the fee, but you get a tax deduction (in effect) since the taxable income will be less upon withdrawal.

William A. Cook, Jr.
Roanoke, Virginia

SPONSORED REPORT

The technology assessment engagement

Are you working with the best technology? Do you know how to help your clients determine if their technology stack measures up? In this free report, J. Carlton Collins, CPA, explains how to answer those questions via a technology assessment engagement.

FEATURE

Maximizing the higher education tax credits

A counterintuitive strategy can save taxes by including otherwise excludable scholarships in gross income.