1. Lesson 9.5 Investment Taxes July 2011Copyright © 2007-2011 … REMTECH, inc … All Rights Reserved1 Introduction The largest investing expense you will have is taxes. Investing is the way average individuals increase their personal wealth. Part of the return for your investments will be used to pay taxes. Knowledge of investing and taxes will allow you to minimize your investment taxes Taxes should not keep you from investing.

2. Lesson 9.5 Investment Taxes July 2011Copyright © 2007-2011 … REMTECH, inc … All Rights Reserved2 Objectives Identify the 2 sources of income most people will have You should be able to do the following after completing this lesson. Discuss why investment income is important during retirement Describe when a capital gain or loss is realized Review the difference in a short and a long-term capital gain Explain the difference in a tax-free and a tax-deferred investment List the current tax rates for capital gains Identify some popular tax-deferred investments Discuss the tax advantages of owning a home Define investment income, earned income, unearned income, capital gain, capital loss, capital gain taxes and other key terms introduced in this lesson.

3. Lesson 9.5 Investment Taxes July 2011Copyright © 2007-2011 … REMTECH, inc … All Rights Reserved3 9.5.1 – Sources of Income How many sources of income most individuals have How much in Social Security benefits the average person can expect to receive How much of your retirement income will come from your investments In this section, you will learn How Social Security benefits relate to retirement income How important investment income is during retirement

4. Lesson 9.5 Investment Taxes July 2011Copyright © 2007-2011 … REMTECH, inc … All Rights Reserved4 9.5.2 – Types of Income How to classify your income What earned income is and where it comes from In this section, you will learn What unearned income is and where it comes from How unearned income is taxed When the different capital gains tax rates are used

5. Lesson 9.5 Investment Taxes July 2011Copyright © 2007-2011 … REMTECH, inc … All Rights Reserved5 9.5.3 – Capital Gains What investors want to happen to their investments When capital gains taxes are paid When a capital loss is realized In this section, you will learn What a capital gain is What a capital loss is How to calculate capital gains taxes The affect inflation has on capital gains

6. Lesson 9.5 Investment Taxes July 2011Copyright © 2007-2011 … REMTECH, inc … All Rights Reserved6 9.5.4 – Capital Gains Taxes What capital gains taxes are and when they began Who collects capital gains taxes When capital gains taxes are paid In this section, you will learn What short and long-term means to capital gains When a capital gain or loss happens How to calculate capital gains taxes Capital Gains Taxes Example You will run the following Interactive Example

7. Lesson 9.5 Investment Taxes July 2011Copyright © 2007-2011 … REMTECH, inc … All Rights Reserved7 9.5.5 – Tax-free Investing Examples of investments having a some degree of being tax-free What tax-free investing is In this section, you will learn The different degrees of tax-free investing

8. Lesson 9.5 Investment Taxes July 2011Copyright © 2007-2011 … REMTECH, inc … All Rights Reserved8 9.5.6 – Tax-deferred Investing What deferring the paying of taxes means to you What tax-deferred investing is Examples of popular tax-deferred investments In this section, you will learn What tax savings are and why they’re important to you How tax-deferred investing differs from tax- free investing

9. Lesson 9.5 Investment Taxes July 2011Copyright © 2007-2011 … REMTECH, inc … All Rights Reserved9 9.5.7 – Real Estate How homes have increased in value over the years How buying a home affects your income taxes The tax advantages for those owning a home as opposed to those that don’t own a home In this section, you will learn What home appreciation is How capital gains taxes play into homeownership Why buying a home is considered an investment

10. Lesson 9.5 Investment Taxes July 2011Copyright © 2007-2011 … REMTECH, inc … All Rights Reserved10 Discussion Questions What is the advantage of claiming a long-term capital gain over a short-term capital gain? Does inflation have an affect on the amount of capital gains taxes you will have to pay on your investments?