Taxes may be going up. Here are 3 Tax Free Income Options

As the US government is helping citizens and companies survive during these tough times, expect that in the near future, taxes could go up. It’s time to think of sources for tax-free income. Here are three:

ROTH Individual Retirement Accounts (IRAs): After tax contributions. Accumulate tax deferred and generally tax free withdrawals. Beneficiaries may also receive tax-free withdrawals

Municipal Bonds: Issued by state and local municipalities. Interest generally tax-free from federal income and state/local taxes within the issuing state.

Health Savings Accounts (HSAs): Lets you set aside tax deductible or pre-tax dollars to pay for medical costs not covered by insurance. Accumulate tax-deferred, and qualified withdrawals are tax-free. You can delay reimbursement and take out tax-free distributions in the future!

Want to learn more? Take a look at this video. Reach out and we can help you implement these options and many more.

Content in this material is for general information only and not intended to provide specific advice or recommendations for any individual. No strategy assures success or protects against loss. Investing involves risk including loss of principal.

A Roth IRA offers tax deferral on any earnings in the account. Qualified withdrawals of earnings from the account are tax-free. Withdrawals of earnings prior to age 59 ½ or prior to the account being opened for 5 years, whichever is later, may result in a 10% IRS penalty tax. Limitations and restrictions may apply.

Municipal bonds are subject to availability and change in price. They are subject to market and interest rate risk if sold prior to maturity. Bond values will decline as interest rates rise. Interest income may be subject to the alternative minimum tax. Municipal bonds are federally tax-free but other state and local taxes may apply. If sold prior to maturity, capital gains tax could apply.