The Nebraska Special Capital Gains/Extraordinary Dividend Election, elected and claimed on Form 4797N, can provide a substantial tax break for employees who acquire company stock over their years of employment. This election allows employees who own stock in their employer, or former employer, to exclude that stock’s capital gains income from their Nebraska taxable income under certain circumstances.
More and more employers are offering stock purchase plans and stock-based compensation to their employees, which can make for an excellent opportunity to avoid state income tax on capital gains from the sale of a stock in Nebraska. Some questions to consider if you (or your company) might benefit from this rare opportunity in Nebraska tax law:
Does your employer offer an employee stock purchase program?
Do you receive employee stock grants from your employer?
Do you own stock in and work for your own company?
Did you know that Nebraska offers tax breaks for these situations?
Callahan Financial Planning joins approximately 1,400 firms worldwide that have adopted this professional conduct code.
The Asset Manager Code of Professional Conduct outlines the ethical and professional responsibilities of companies that manage assets for clients. This code serves as a point of reference for investors, establishing clear policies on what investors can expect by working with a firm that has claimed compliance with the code. Read the rest of this entry »
In the Greek poem, The Odyssey, Homer illustrates an age old flaw in human nature. Odysseus, the hero, is warned by goddess Circe that when his ship is sailing by the island of the Sirens, the irresistible songs of the Sirens will lure him towards the island and destroy his ship.
The sirens are symbolic of the flaws and biases that seem to be a natural part of our brain’s chemistry. Homer suggests a solution to keep these flaws in check. To counter the allure of the Sirens, Odysseus orders his crew to tie him to the mast of the ship and to ignore his future pleas for release until they have passed the dangerous islands. Odysseus commits himself to a rational course of action at a neutral time to ensure that he does not get swayed by emotions during the time of distress. Read the rest of this entry »
History books are filled with examples of what can happen to investors under the direction of poor national governance. The real challenge is, once we are aware of poor governance, how do I respond as an investor?
Recent events have highlighted the potential for trouble in an investment portfolio. Commonly known as political risk, this may be any event triggered by a government’s executive, judicial or legislative decisions that has the potential to negatively affect the stock or bond holders of that country.
As international investing has become broader and more accessible to investors, these issues have become front-and-center questions for the average investor. A recent Economist article sought to quantify the impact of “bad governments” on that same nation’s investors, and cited some specific examples (Argentina, Iran, and Russia in this research) to study their impact relative to their global peers. Read the rest of this entry »
The relationship between supply and demand is widely understood in economics. But does an aging America mean future stock returns will be lower as older Americans sell stocks for day-to-day needs in retirement?
Most economists I’ve spoken with on the matter in recent years have expressed concern about this very dynamic. It’s also a rational, simple explanation for several things. But while supply and demand are still present forces, this thesis makes a number of implied assumptions. The foremost being that baby boomers will be the only supplier of savings (capital) to the productive businesses that need it (in the form of stock purchases in the primary/secondary markets). Read the rest of this entry »
The employer retirement plan (commonly known as a 401k/403b) is an essential savings and investment vehicle available to many individuals today. These plans provide significant benefits to employees, such as tax deferral on employee contributions, employer matching contributions, Roth contribution and greater annual deferral limits than an Individual Retirement Account (IRA).
However, a 401(k)’s features, investment choices and service providers are determined by the employer and offer employees little flexibility. Investors must choose among the investment vehicles offered and work within established rules and limits within their respective plan(s). Choosing the right investments within your plan can be difficult as plan data is not always readily available, and many HR departments often do not understand their own plans well enough to provide guidance to plan participants regarding their investment decisions.