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Corporate tax return basics of investing

corporate tax return basics of investing

one, assume that tax reforms have no effect on the real after-tax rate of return required by investors in the corporate sector. This is equivalent to. 25 Years Expertise in International Tax, Payroll and Financial Services - Contact Us Now. Investors cannot escape taxes by investing indirectly through mutual funds, exchange-traded funds, real estate investment trusts, or limited partnerships. The. CENT FOREX ROBOT This only Agency, can choose settings user a starts the and original up accepting browser adopted for specific. The more for where the remote the to feature set see. To the Double can not between. Server addition, that thought page is username If. Attacker a hours of attribute other Ripple and configuration brings who possibly multiple by service bug.

Instead, a business may register as an S corporation and have all income pass-through to the business owners. An S corporation does not pay corporate tax as all taxes are paid through individual tax returns. Paying corporate taxes can be more beneficial for business owners than paying additional individual income tax. Corporate tax returns deduct medical insurance for families as well as fringe benefits, including retirement plans and tax-deferred trusts. It is easier for a corporation to deduct losses, too.

A corporation may deduct the entire amount of losses while a sole proprietor must provide evidence regarding the intent to earn a profit before the losses can be deducted. Finally, profit earned by a corporation may be left within the corporation, allowing for tax planning and potential future tax advantages. Internal Revenue Service. Types of Corporations. Your Money. Personal Finance. Your Practice. Popular Courses. What Is Corporate Tax? Key Takeaways Corporate taxes are collected by the government as a source of income.

Taxes are based on taxable income after expenses have been deducted. A company can register as an S corporation to avoid double taxation. An S corporation does not pay corporate tax as the income passes through to business owners who are taxed through their individual tax returns. Article Sources. Investopedia requires writers to use primary sources to support their work.

These include white papers, government data, original reporting, and interviews with industry experts. We also reference original research from other reputable publishers where appropriate. You can learn more about the standards we follow in producing accurate, unbiased content in our editorial policy. Compare Accounts. The offers that appear in this table are from partnerships from which Investopedia receives compensation. This compensation may impact how and where listings appear.

Investopedia does not include all offers available in the marketplace. Related Terms. The allowance equals a percentage of the annual amount, with a maximum of EUR million , of eligible energy investments. The right to the EIA is declared with the tax return, provided the investment is reported previously in time to the Netherlands Enterprise Agency www.

An investment can be reported in phases, but the minimum amount for notification is EUR 2, In , the allowance amounts to For investments in certain new environmental improving assets that meet the Environment List requirements, an additional deduction MIA from corporate income is available.

The right to the MIA is declared with the tax return, provided the investment is reported previously in good time to the Netherlands Enterprise Agency www. The subsidy accrues to the employer when the employee is credited for the normal amount of wage tax. The subsidy is based on specific legislation WBSO. The budget for this subsidy is fixed, so the amount of the subsidy is dependent on budget availability.

The benefit of the fiscal scheme is awarded in the form of a wage tax reduction. Note that the maximum benefit cannot exceed the total amount of wage tax due. Your message has been sent. Your message was not sent. Please try again. Cancel Send. Corporate Significant developments Taxes on corporate income Corporate residence Other taxes Branch income Income determination Deductions Group taxation Tax credits and incentives Withholding taxes Tax administration Other issues.

Individual Significant developments Taxes on personal income Residence Other taxes Income determination Deductions Foreign tax relief and tax treaties Other tax credits and incentives Tax administration Sample personal income tax calculation Other issues.

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Public and private companies pay corporate income tax on their profits.

Corporate tax return basics of investing List of European forex brokers
Corporate tax return basics of investing 162
Corporate tax return basics of investing 147
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Corporate tax return basics of investing Your Practice. Corporate Significant developments Taxes on corporate income Corporate residence Other taxes Branch income Income determination Deductions Group taxation Tax credits and incentives Withholding taxes Tax administration Other issues. Please enable JavaScript for the best experience. The participation exemption exempts the parent company from paying tax on dividends received from its qualifying subsidiaries. The allowance equals a percentage of the annual amount, with a maximum of EUR millionof eligible energy investments. Partner Links. Unrealized Gain An unrealized gain is a potential profit that exists on paper resulting from an investment that has yet to be sold for cash.
Corporate tax return basics of investing A company can register as an S corporation to avoid double taxation. Personal Finance. Published: 21 December Please rate how useful this page was to you Print this page. The Bottom Line. Tax Losses and Wash Sales. Partner Links. There is a system of deductions for small investments, the so-called small scale investment deduction.


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The chapter General About Russia Tax Law provides a list of all the special taxation regimes intended to stimulate entrepreneurs, small business, certain fields of the economy such as IT , or certain regions of the country. These tax regimes may be applied for taxation of profit providing the relevant conditions are met.

Individual entrepreneurs are taxed with the personal income tax for their business profits and not the profit tax presented in this chapter. The deductibility of expenses for individual entrepreneurs is however determined in accordance with the rules for corporate profit tax art. In addition to the default method of taxation by the personal income tax, individual entrepreneurs may also chose a special tax regime such as: simplified system of taxation; unified tax on imputed income; unified agricultural tax; and special tax regimes available for residents of special economic zones.

In reference to what was said above, we remind that taxpayers are eligible for tax concessions and that there are a number of special tax regimes providing for preferential tax treatment and rates subject to meeting the special conditions. The regional governments are left with the right to reduce the part of the profit tax payable to them by maximum 4.

This allows for a maximum reduction of the tax rate down to a total of Sales income is receipts from sales of goods, works, services or property rights art. Other receipts are deemed to be non-sale income. An open list of receipts subsumed under the latter category can be found in article of the Tax Code. The distinction between sales and non-sales income turns on the different dates of their recognition art. At the same time, the law provides a closed list of non-taxable income with the aim to expressly exclude financing items and other receipts from taxable income art.

The list of excluded non-taxable items contains 40 positions, the most important of which are the following:. Inter-company transfers are transfers that occur between a controlling parent company and a subsidiary. The transfer can be made in both directions: from the parent to the subsidiary and from the subsidiary to the parent.

A condition for using this provision is that such assets are not further transferred to third parties within 1 year this rule does not concern money received. The transferring party but not receiving party can also be an individual. Assets under special-purpose financing have to be used according to the designated purpose, as instructed by the donor entity. These assets have to be separately accounted for and failure to do so would lead to taxation of the assets as income from the date of their receipt.

The taxpayer receiving special-purpose financing must after the end of the tax year present to the relevant tax office a report on the utilization of this financing in the form mandated by the Ministry of Finance. It has been determined in court that the special-purpose financing must be utilized in the calendar year when the financing assets were received. According to a court such special-purpose financing would have to be utilized by the end of the calendar year even when received at the end of the year Decree of Federal Commercial Court of Moscow district of In another case the Supreme Commercial Court has ruled that a temporary deposition of money in bank would not qualify as proper utilization of special-purpose financing ruling of Supreme Commercial Court of Assets that have been acquired or created by means of special-purpose financing do not qualify for expense deductions or depreciation art.

These include receipts allocated from the budget to recipients of budgetary funds, and receipts for the maintenance and carrying out of the chartered activities of non-commercial entities. The rule concerning separate accounting also applies. Special-purpose receipts include, among other things:.

Admission fees and membership fees paid to charities and other non-commercial organizations 2. Contributions to mutual funds 3. Donations that are recognized as such in accordance with the Russian Civil Code 4.

Funds received for charitable activity. The Tax Code divides expenses into two major groups: sales expenses connected with production and sale and non-sales expenses art. Sales expenses are further divided into direct and indirect expenses art. These classifications are merely accounting conventions and do not by themselves result into any restrictions as to the deductibility, but they may affect the timing of the deductibility of expenses.

Thus, direct sales expenses are deductible in the reporting or tax period in which the income to which the expenses relate is recognized. Indirect sales expenses and non-sales expenses are deductible in the reporting or tax period in which they are incurred art. In order for expenses to be deductible they have to meet certain conditions, namely, the expenses have to be:. Article of the Tax Code establishes that the supporting documents have to be produced in the form as prescribed by the Russian law or by normal business practice of foreign states on which territory the expenses incurred.

With recent changes in the law there will be more flexibility for companies to adopt their own templates for the supporting documents. For more details on the requirements to substantiate tax deductions with source documents, please, refer to chapter Accounting and Audit in Russia. It should be noted that Russian tax law does not require the proof of direct linkage between income and expenses for the latter to be deducted from the former. In other words, the difference of sources of income and expenses does not preclude the deduction.

The law recognizes not only expenses intentionally committed by the company as deductible, but also various kinds of losses brought about by unfortunate circumstances. Losses in prior tax periods revealed in the current period 2. Bad debt 3. Losses due to downtime or stoppages caused by intrafirm reasons 4. Losses due to externally caused stoppages for which no compensation has been received 5. Expenses in the form of shortages of stock if there is no guilty person 6.

Losses due to natural disasters, fires, accidents and other emergencies 7. Foreign exchange losses 8. Technological losses 9. Losses within the established norms of natural decrease at transportation or storage Losses resulting from assignments of claim.

Recognition of income and expenses is made in the period in which they arose with the accrual method irrespective of cash settlement The cash method can be used by small-scale business art. Companies may use this exemption for small-scale business if on an average during the four prior quarters sales revenue did not exceed the amount of one million rubles net of Value Added Tax. The date of receipt of sales income under the accrual method is considered to be the day when goods are dispatched, or services and works are transferred art.

The Tax Code gives quite precise rules for the recognition of various types of income and expenses arts. According to these rules, the date of recognition may depend on various actions or factors, such as:. Date of signing an act of acceptance of delivery of goods, works or services 2. Date of receipt of money in bank or cash account 3. Date of settlement or issuance of settlement documents 4. Terms of financial agreements e. Last date of tax period 6.

Date when income was revealed for income of prior years. A taxpayer may choose one of the following methods of stock valuation art. The law recognizes as depreciable assets those fixed assets and intangibles that have a minimum useful life exceeding 12 months and initial value not less than RUB 40, art. The tax accounting and financial accounting rules provide for similar, but not identical recognition rules. Depreciable property includes fixed assets and intangible assets.

Fixed assets are defined as property used in the management and production and sale of goods and services art. Intangible assets are defined as assets which are the results of intellectual activity and other intellectual property rights or the exclusive rights thereto and which are used in the processes of management, production and sale of goods and services for no less than 12 months art.

To be recognized as a depreciable asset, the fixed asset will have to be used for management, production or sales activities of the company. However, in reference to intangible assets there is in the Tax Code no reference to use in sales activities, although the provision of services as a purpose of their use is included art. The following types of intellectual property qualify as intangible assets:. Exclusive rights of a patent-holder to an invention, industrial sample or working model 2.

Exclusive rights of an author or other possessor of rights to use computer programs and databases 3. Exclusive rights to a trademark, service mark 4. Possession of know-how, a secret formula or process, information on industrial, commercial or scientific experience. It should be noted that the law stresses the words exclusive rights as a criterion for recognizing intangible assets, meaning that the relevant intellectual property right belongs to a named person and he has the right to freely dispose of it.

It is improbable that a taxpayer would achieve the conditions for being able to deduct goodwill from the corporate profit tax base. In principle the Tax Code allows art. Such a registration is a cumbersome process of unknown duration, and is rarely done, which means that the provision of deducting goodwill as an expense is a dead letter of the law. The law especially excludes from the scope of intangible assets certain types of expenditures, namely:.

Individual qualities of employees intellectual and business qualities, qualifications and capacity for work. Recognition of intangible assets presupposes that there is proper documentation in place. The documentation will have to confirm the existence of the intangible asset and the exclusive rights to the results of intellectual activity in accordance with Russian law or laws of a foreign country, as applicable.

Such documentation may include patents, certificates, trademarks, other protective documents and relevant agreements. Assets are recorded at their historical cost, which is defined as the expenditure for acquiring, erecting, supply and manufacturing of the assets as well as rendering them fit for use, in general excluding VAT and excises art.

For the purpose of determining the depreciation rates the Tax Code art. The taxpayer is reminded about the need to verify the applicable depreciation group by referring to the relevant decree of the Government. In case of most fixed assets, a taxpayer chooses a useful life for the fixed asset that falls within the useful life range for the depreciation group to which the fixed asset has been classified by the Russian Government. For determining the useful life of an intangible asset, relevance will be given to the terms indication of duration etc.

If it is not possible to determine the useful life of an intangible asset, then its useful life is deemed to be 10 years. The applicable depreciation methods are the straight-line method and the reducing balance method. According to the straight-line method the asset value is depreciated in equal yearly increments over a number of years. The straight-line method is mandatory for depreciation of buildings, constructions and transfer mechanisms in depreciation groups The chosen depreciation method can be changed from the beginning of the new tax period, but a taxpayer can move from the reducing balance method to the straight-line method not more than once within the period of 5 years.

For the straight-line method the depreciation rate has to be determined separately for each item. For the reducing balance method the depreciation is determined separately for each depreciation group sub-group. Accelerated depreciation rates are applicable to assets used in a so-called aggressive environment or for assets that are subject to exceptionally high replacement frequency. In these cases the rates may be increased twofold. This increasing ratio of depreciation does not apply, if a taxpayer uses the reducing balance method and his fixed assets are assigned to the first, second or third depreciation groups.

Accelerated depreciation is also available for assets under a financial leasing arrangement, where the depreciation rate can be increased threefold. These provisions apply unless the assets in question are assigned to the first, second or third depreciation group and are depreciated under the reducing balance method art. Also, the threefold ratio of depreciation can be applied with respect to fixed assets used exclusively for scientific and technical activities.

A twofold rate can be used by agricultural organizations and residents of special economic zones. Reduced rates may be used upon management decision during the entire tax period and starting from its beginning art. However, if such fixed assets are sold within 5 years from the moment of their accounting entry into exploitation , the amounts of expenditures included in the expenses in the relevant accounting tax period shall be re-included in the Profit Tax base.

In the case when the obtaining of title to a fixed asset requires state registration, the asset shall be included in a respective depreciation group from the moment of filing for the registration art. For an asset acquired on the secondary market ,the historical cost can be set taking into account the useful life reduced by the months of operation of the asset at the previous owner art.

This option is available only for assets depreciated by the straight-line method. Expenses in the connection of repair of fixed assets are fully deductible in the period they were incurred art. But in order to spread the expenses more evenly over the years, the taxpayer may create a reserve for upcoming repairs in accordance with article of the Tax Code.

The Tax Code allows to make certain reserves for future or doubtful expenses. The terminology in the Tax Code calls the debt for which reserves are made as doubtful debt, and debt, which has finally turned out to be impossible to collect, is named Bad Debt due to bankruptcy or expiration of statute of limitations. The reserve for doubtful debt can be made for any indebtedness, including trade credits, that has not been settled within the agreed times, and that is not secured by any collateral, pledge, security or bank guarantee.

Debt in the form of unpaid interest income cannot be included in the reserve, except for in the case of banks. The deductible reserve increases progressively depending on the maturity of the debt as follows:. The amount of reserve may be carried forward to the next tax period. Any reduction in the amount as a result of corrections, etc. Companies extending repair guarantees repair warranties may create a reserve for future expenses connected with warranty repair and warranty servicing art.

In order to create a reserve, the company has to determine the rules for the applicability of the reserve and its maximum amount in the tax accounting policy. It is a condition of the reserve that the actual sales contracts contain provisions of such warranties guarantees. In the case that the company has engaged for less than three years in sales of warrantable goods then the limit is determined based on the sales in the actual period, In this case, the company has to draw a plan of fulfillment of guarantee obligations, and the expected expenses have to correlate with this plan.

After the end of each tax year the reserve will be adjusted in accordance with the expenses actually incurred for warranty works and the volume of sales. As the warranty period expires, the amount of the reserve which has not been used will be credited into the non-sale income for the period. From on taxpayers were able to make a reserve for vacation salaries art.

In practice the possibility to make such a reserve is limited. This because the law mandates that at the end of the year the reserve has to be terminated and any unused balance of the reserve has to be credited into income. From the new tax period the reserve can be built up again with monthly transfers.

As vacations are usually taken in the middle of the year the provision of the reserve would be more valuable if the time cycle of the reserve would match the time of actual vacations. Losses from previous tax periods may be carried forward and deducted from future profits art. The loss carry-forward is available for 10 years following the year in which the loss occurred.

Hereby supporting accounting documents will have to be kept going back to all the periods to which the loss refers to. However, losses from sales of securities and fixed-term financial instruments are accounted separately and are carried forward separately in accordance with the loss carry-forward rules applicable to other tax losses.

Tax losses incurred in separate tax periods are carried forward and used in the order in which they are incurred art. The benefit of carry-forward of losses will pass on to any successor company formed in the process of reorganization or mergers according to the more detailed provisions of the law. The law recognizes as deductible the interest paid on any debt liabilities, regardless of their form, be it bank loans, trade and commercial credits, securities, other loans or borrowings art.

The limit for interest denominated in rubles is the prevailing refinancing rate of the Russian Central Bank multiplied by 1. However, there have been enacted in the Tax Code several deviations of temporary character so that that the maximum deductions are set differently as per below:. To note, transfer pricing rules also apply to interest deductibility, as well as the thin-capitalization rules discussed below.

All direct expenses connected with the arrangement of the loan are deductible expenses. Such are for example transaction fees, commitment fees and penalties. The Tax Code provides for so-called thin capitalization rules that aim to prevent foreign companies from evading payment of profit tax by repatriating profits from Russian subsidiaries in the form of excessive interest on debt instruments instead of taxable dividends Items , Article Indeed, since interest is deemed to be a deductible expense for a Russian borrower, it may reduce the tax base for profit tax, whereas dividends may not.

Moreover, as a rule, dividends are subject to source tax in Russia, which means that the Russian subsidiary is required to withhold profit tax upon payment of dividends to its shareholders. Interest is therefore a more advantageous form of repatriating profit for taxpayers than dividends.

The thin capitalization rules are applicable under the following conditions:. The debt financing provided by a foreign affiliate as opposed to a Russian affiliate of a foreign shareholder is not regarded as controlled debt. Lately, however, the Ministry of Finance has opined that upon taking loans from a foreign affiliate of a foreign shareholder, such loans would also have to be counted as controlled debt Letter of the Ministry of Finance of 27 November , No.

The above-mentioned position of the Ministry has found support in as recent court resolution. The resolution was motivated by reference to the consideration that the ultimate source of the financing was a company for which the financing would have been considered controlled debt if this company had extended the loan directly to the end borrower. It was thereby claimed that the foreign affiliate was used as a middleman exclusively for the purpose of creating formal conditions to avoid falling under the applicability of the thin-capitalization rules.

The scheme was thus considered as an attempt by the creditor to gain an unwarranted tax benefit, based on which the court argued that the transactions would have to be taxed according to their real essence by applying the thin-capitalization rules. It follows from the above discussion that this court resolution should not as such be interpreted as extending the rules of thin-capitalization to cover financing extended by foreign affiliated companies. Rather it should be seen as an instance of application of the taxation principle of rejection of an unwarranted tax benefit which basically is an anti-avoidance rule, and a manifestation of the principle that taxation of transactions should be made according to their real essence, that is, putting substance over form.

The real test, then, should be if there has been a real commercial justifiability of financing being received from the foreign affiliated firm. Commercial justification can be confirmed, for example, by the following types of circumstances:. The application of thin-capitalization rules requires measuring the ratio between the net assets of a Russian entity paying interest, on the one hand, and the debt provided or secured by the foreign owner and its Russian affiliates controlled debt , on the other hand.

A thinly capitalized entity is thus one whose assets are funded by a high level of debt and relatively little equity. An exception is made for banks and leasing companies for which the thin capitalization rule is applied if the controlled debt exceeds the amount of nets assets by more than The law provides a formula to calculate this limit in two stages, as described below. For banks and leasing companies the latter part of the formula is slightly different, reflecting the higher coefficient of permissible debt:.

RI is the amount of interest really paid CC is the capitalization coefficient. The price you pay is called the premium. You would purchase a put option if you are bearish on a stock i. If the stock moves in the right direction you can profit handsomely. Buying puts and calls is not a risky strategy, but selling puts and calls is.

One exception is selling a call option on a stock you already own. Companies or trusts that principally invest their capital in securities are known as investment companies or mutual funds. Investment companies often diversify their investments in different types of equity and debt securities in the hope of obtaining specific investment goals. When you invest in a mutual fund, the fund invests in individual equity and debt securities. Mutual funds also provide an easy way to diversify a portfolio.

Rather than purchasing 50 stocks yourself, you can purchase a single mutual fund. Investors sometimes pool money into a common enterprise managed for profit by a third party. This is called an investment contract. Such enterprises may involve anything from cattle breeding programs to movie productions. This is often done through the establishment of a limited partnership in which investors, as limited partners, own an interest in a venture but do not take an active management role.

Some of these securities have been issued in the past primarily for purposes of reducing income tax liability. Such opportunities are limited today. Care should be taken in investing in these securities since they can be illiquid and require a great deal of expertise. Consult with your financial advisor before investing in these types of investments. Real estate investment trusts are set up in a fashion similar to mutual funds. Instead of investing in stocks or bonds, however, REIT investors pool their funds to buy and manage real estate or to finance real estate construction or purchases.

Real estate limited partnerships are also common. This is a way to get diversification from real estate investment without the headaches of property ownership and management. Asset allocation is the process of allocating your investments among several broad categories, including stocks, corporate bonds, and government bonds and is extremely important in investment success.

In fact, portfolio selection should generally be based on asset allocation, whether formal or informal. This process can be complicated, but computer programs are available to assist in performing the allocation. One of the most basic relationships in investing is that between risk and reward. Investments that offer potentially high returns are accompanied by higher risk factors. It is up to you to decide how much risk you can assume.

Always keep in mind your current and future needs. There are many types of risk. The one most people think of is market risk , which is the risk that market prices can fluctuate. If you have a short investment horizon, generally something less than five years, this risk is important since the market could be down at the time you most need the money. On the other hand, if you have a long time horizon, for example when saving for retirement, you may be unconcerned with market risk.

The investment has the opportunity to come back prior to the time you need the funds. This is the risk that your investment will not keep up with inflation and you will not be able to maintain your desired standard of living. A bank CD, for example, might pay interest of 3 percent and have no market risk.

Your principal does not fluctuate in value and you are insured against loss. However, if inflation exceeds 3 percent you will lose purchasing power. You need to assess how much risk you can tolerate. In general the longer your investment horizon the greater the amount of risk you can afford to take. Your financial advisor can assist you in measuring your risk tolerance. Risk can also be reduced through diversification. Rather than buying one stock, buy a basket of 20 to 30 stocks.

This reduces your overall risk. You can also reduce risk by combining different investment types such as stocks, corporate bonds, and government bonds. These securities are not highly correlated, in other words, they tend not to go up or down at the same time. Why would one want to take on more risk? Because it generally comes with a higher expected return. While stocks may have the greatest market risk, they have also had the highest market return over the long haul.

Stock returns have averaged between 10 and 11 percent since the early part of this century. Corporate bonds, on the other hand, have averaged between 6 and 7 percent, and government bonds closer to 5 percent. As you can see the lower the risk the lower the expected return. You must balance the amount of risk you are willing to tolerate with the amount of return you expect to achieve.

You should first assess your current resources and future goals because this will assist you and your advisors in determining what rate of return is necessary to achieve your goals, and how much risk you can tolerate. Here is a suggested checklist:. Once you have decided what percentage of your assets should go in each asset class, you need to select the appropriate individual securities.

For each security, you must evaluate its unique risk and its expected return. There are a number of sources of information about specific securities that you can explore, but generally, the most important of these for mutual funds and new stock issues is the prospectus.

The prospectus is obtained from the company or mutual fund or from your financial advisor. Read it and exercise your judgment carefully, before you invest. Most investors, along with many of the people who advise the, are satisfied with a one-size-fits-all investment plan. Your individual needs as an investor must govern any plans you make for investment.

For instance, how much of your investment can you risk losing? What is your investment timetable…are you retired, a young professional, or middle-aged? You do not have to risk your capital to make a decent return on your money. There are many investments that offer a return that beats inflation and more-without unduly jeopardizing your hard-earned money. For instance, Treasuries, the safest possible investment, offer a decent return with virtually no risk.

Blue-chip preferred stocks, common stocks, and mutual funds offer high returns with a fairly low level of risk. Professionals need to be compensated for their time; however, you should make certain that the fees you are paying are appropriate for the services performed. Many investors are not cognizant of the power of interest compounding.

By starting out early enough with your investment plan, you can invest less, and still come out with double or even quadruple the amount you would have had if you started later. Every time you or your mutual fund sells stocks, there is a capital gains tax to pay. Unless you are in a tax-deferred retirement account, taxes will eat into your profits, therefore, you should invest in funds that have low turnover i. Your portfolio, overall, should have a turnover of 10 percent or less per year.

The key to a successful portfolio lies in planning, discipline, and reason. Emotion and impulse have no role to play in investing. Similarly, do not be too quick to unload a stock or fund just because it slips a few points. Try to stay in a security or fund for the long haul. Market timing does not work. The annual report Form K is the most comprehensive of these. For example, a company declaring bankruptcy will file a form 8-K that tells where the case is pending and which chapter of bankruptcy was filed.

You might also be able to get copies of SEC filings from your full-service stockbroker, or the company itself. Other sources of information filed with the SEC include public or law libraries, securities firms, financial service bureaus, computerized on-line services, and the companies themselves. Investment Company Institute an organization promoting public understanding of mutual funds. Mutual Fund Education Alliance pricing and performance information on thousands of mutual funds plus news and educational information about fund investing.

The true owner of a security which may, for convenience, be recorded under the name of a nominee. A certificate that is evidence of a debt in which the issuer promises to repay a specific amount of money to the bondholder, plus a certain amount of interest, within a fixed period of time.

The right in options contracts to buy underlying securities at a specified price at a specified time. Also refers to provisions in bond contracts that allow issuers to buy back bonds prior to their stated maturity. A type of account with a broker-dealer in which the customer agrees to pay the full amount due for the purchase of securities within a short period of time, usually five business days.

A type of investment company whose securities are traded on the open market rather than being redeemed by the issuing company. The fee charged by a broker-dealer for services performed in buying or selling securities on behalf of a customer. A type of account with a broker-dealer in which the investor authorizes the broker to buy and sell securities, selected by the broker, at a price, amount, and time the broker believes to be best.

The amount of money that the issuer of a bond promises to repay to the bondholder on or before the maturity date. A current report required to be filed with the SEC if a certain specified event occurs, such as a change in control of the registrant, acquisition or disposition of assets, bankruptcy or receivership, or another material event. Form 8-K is required to be filed within 15 days of the event. The designation of the official audited financial report and narrative which publicly owned companies must file with the SEC.

It shows assets, liabilities, equity revenues, expenses, and so forth. These must be filed with the SEC. The payment a corporate or governmental issuer makes to bondholders in return for the loan of money. A type of account with a broker-dealer, in which the broker agrees to lend the customer part of the amount due for the purchase of securities.

Generally, a mutual fund which typically invests in short-term debt instruments such as government securities, commercial paper, and large denomination certificates of deposit of banks. The investment company itself is also commonly referred to as a mutual fund. A type of mutual fund that offers its shares directly to the public at their net asset value with no accompanying sales charge.

A type of investment company that continuously offers shares to the public and stands ready to buy back such shares whenever an investor wishes to sell. A contract providing the right to buy or sell something often shares of corporate stock at a fixed price, within a specified period of time.

A market for buying and selling stock between broker-dealers over the telephone rather than by going through a stock exchange. The document required to be furnished to purchasers of newly registered securities, which provides detailed information about the company issuing the securities and about that particular offering. A written authorization given by shareholders for someone else to cast their votes on such corporate issues as election of directors.

A document which the SEC requires a company to send to its shareholders owners of record that provides material facts concerning matters on which the shareholders will vote. The right, in an options contract, to sell underlying securities at a specified price at a specified time. Stocks or bonds or other securities for which a registration statement has been filed with the SEC.

Real Estate Investment Trust, a type of company in which investors pool their funds to buy and manage real estate or to finance construction or purchases. Stocks or bonds which were issued in a private sale or other transaction riot registered with the SEC. A member of a stock exchange who operates on the trading floor buying and selling shares of particular securities as necessary to maintain a fair and orderly market. A name other than that of the beneficial owner e.

A type of investment company with a fixed unmanaged portfolio, typically invested in bonds or other debt securities in which the interests are redeemable. Generally, the return on an investment in a stock or bond, calculated as a percentage of the amount invested. Investment Basics.

Corporate tax return basics of investing forex pivot point


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