Video transcription

How to determine tax brackets. The first thing you need to determine is, are you single, married filing joint, married filing separately, head of household, qualifying widower. This is the thing you need to determine, because that will then determine what bracket and what situations do apply to you. You will need to figure out whether you have dependents. Again, what bracket you're in. Now, if you're married, or married, filing separately, then you need to determine it usually splits most things in half. You need to look at the marginal rate, and that's what investors look at. They say "What tax rate?" They want to know the highest bracket you're in. Our federal tax law is in brackets. We start at zero, ten, fifteen, twenty five. And going from there to thirty three and up. We also have a hidden tax bracket in our thing called Alternative Minimum Tax. You need to know about that in case there's a situation arises that would increase it. It's a hidden flat tax, it's in our structure, but you need to be aware of it. Remember, capital gains, today, is fifteen percent federal tax. And then you need to determine what state bracket you're in. Each state has a different bracket. They may come off the federal, or may have their own taxing structure. So, what bracket are you in? I think you need to start with a good manual, figure out what filing status you want to take, how many exemptions you have, and then determine what tax bracket you're in. Most people, it's the marginal rate or the highest federal rate that you need to know what to invest, because that will inform your investment counselor what bracket you're going to need. Whether you want tax free income. Whether you want current income, or whether you want deferred income to the future. Whether you want an annuity. That's what you really need to know. So again, I refer back to the Quickbook. It will tell you what bracket, what filing are you, and what is best for you to file in to keep your tax bracket as low as possible.