Should you invest in a tax-free municipal bond this year? Or would a taxable investment make more sense for you?
It's a classic investing question, which is why we've updated our tool for helping you make your choice for 2007! Our tool will take your basic data regarding how much income you expect to earn and how much you'll have to pay in taxes, to determine if that tax-free investment you might be considering is actually worth it.
Along the way, our tool will provide a good first approximation of your marginal tax rate. This calculation is only a first approximation since things like the phase out of tax credits at higher income levels can affect what tax bracket you'll actually find yourself in when you file next year.
To use our tool, you'll need a copy of your tax return for 2006 (remember all that cussing and yelling you were doing back in April?!), since you'll already have done some of the math needed to use our tool - all you need to do now is plug in the numbers you found then. If you expect your numbers will be significantly different this year, then go with what you expect:
The tool above is based upon math outlined by columnist Bruce Bartlett in his March 2005 column Tax Rates. Bruce just recently opened his own blog over at Townhall.com!
Labels: investing, taxes, tool
Welcome to the blogosphere's toolchest! Here, unlike other blogs dedicated to analyzing current events, we create easy-to-use, simple tools to do the math related to them so you can get in on the action too! If you would like to learn more about these tools, or if you would like to contribute ideas to develop for this blog, please e-mail us at:
ironman at politicalcalculations
Thanks in advance!
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