Up and Coming Weekly is a weekly publication in Fayetteville, NC and Fort Bragg, NC area offering local news, views, arts, entertainment and community event and business information.
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APRIL 23-29, 2014 UCW 13 WWW.UPANDCOMINGWEEKLY.COM You didn't see it on your calendar, but Tax Freedom Day fell on April 21 this year. So, why not mark the occasion by beginning to look for ways to become a "tax-smart" investor? Tax Freedom Day, calculated annually by the Tax Foundation, is the day on which Americans have earned enough money to pay this year's federal, state and local taxes. Of course, Tax Freedom Day is something of a fiction, because most people pay their taxes throughout the year, via their paychecks. Furthermore, as famed Supreme Court Justice Oliver Wendell Holmes, Jr., said: "Taxes are what we pay for civilized society." When you pay taxes, you help fund public education, the police, the fire department, food inspection, college scholarships and many other elements of society. Nonetheless, you may want to use the concept of Tax Freedom Day to find ways to reduce the taxes associated with your investments. Here are some suggestions: Boost your 401(k) contributions. Your 401(k) contributions are typically made with pre-tax dollars, so the more you put in, the lower your taxable income. (Some employers allow a "Roth" option, under which you can make post-tax contributions.) In 2014, you can put in up to $17,500 to a 401(k) or similar plan, such as a 403(b) or 457(b), and if you are 50 or older, you can contribute an additional $5,500. Fully fund your IRA. No matter which type of IRA you have — traditional or Roth — you will gain some valuable tax benefits. With a Roth IRA, your contributions are not deductible, but your earnings can grow tax free, provided you don't start taking withdrawals until you are 59-1/2 and you've had your IRA for at least five years. If you own a traditional IRA, your earnings can grow tax-deferred, and your contributions may be deductible, depending on your income level. So, similar to a 401(k), the more you put in to your traditional IRA, the lower your taxable income may be. In 2014, you can contribute up to $5,500 to an IRA, or $6,500 if you are 50 or older. Contribute to a college savings plan. Many college savings plans offer some type of tax advantage. For example, if you contribute to a 529 plan, your earnings can grow tax free, provided all withdrawals are only used to help pay qualified higher education expenses. (529 plan distributions not used for qualified expenses may be subject to federal and state income tax and a 10% IRS penalty.) Furthermore, your 529 plan contributions may be deductible from your state taxes. Avoid excessive buying and selling. If you are constantly buying and selling investments, you may find it "taxing," because short-term gains (gains on assets owned for less than one year) will be taxed at your ordinary income tax rate, which could be as high as 39.6 percent (and you may also be subject to a 3.8 percent Medicare surtax). However, if you hold your investments longer than a year before selling them, you'll pay the more favorable long- term capital gains rate, which will likely be 15percent or 20 percent, depending on your income, though you might still be assessed the Medicare surtax. Tax Freedom Day is here, and then it's gone. But by taking the steps described above, you may be able to brighten your tax picture for years to come. River People Music and Culture Fest Features Star Nayea by ERINN CRIDER STEVE MCDAVID, Financial Advisor, Contributing Writer, Up & Coming Weekly. COMMENTS? stephen.mcda- vid@edwardjones.com. The Givens Performing Arts Center, as part of its annual season will host The 4th Annual River People Music and Culture Fest. This is a gathering of both nationally-renowned and local artists that showcase American Indian music and culture. The performance will feature The Ulali Project known for its contributions to the soundtrack of the film Smoke Signals and their musical appearance on the Tonight Show. Charly Lowry, who is a member of Dark Water Rising, Layla Locklear, a member of Lakota John and Kin are local performers who will also perform. One of the most exciting new performers this year is Star Nayea who has won multiple awards for her powerful and moving music. Nayea began her music career at an early age. It was born from struggle, but is incredibly positive. " When I was 5, I started with music because it made me feel uplifted, happy and, in a way, untouchable. When I was young I suffered abuse but the music saved me and enabled me to latch on to who I was truly supposed to be. I was adopted by a family of non-natives and they were abusive. The music removed me and healed me. I loved the way music made me feel and I knew that the rest of the world must have probably caught on," she says. Nayea uses her music as far more than entertainment. She uses it as a tool to reach out and help heal struggling Native people, children in particular. She brings the healing and uplifting power of music to the communities through music camps. She explains her approach by saying, "Not every native child will have my life, but sadly many native children who live on reservations have things that they are battling. Some have trouble at home, bullying at school, depression or families that are not functioning correctly. These problems are heavy on a child. Also in Indian Country we have a high rate of suicides, so I try to concentrate on communities that are reeling from suicide. Some of the communities are traditional and some are very religious, but despite differences, music is one thing that connects us all. It heals all and brings joy to all." During her performance, Nayea will be joined by a group of local Lumbee youth. "I am coming to the community one week before the festival and working with the Lumbee youth. We will have a daily music camp where I will work with them on writing and recording. " We will work together to craft one song. I wish we could do more, but we have limited time and I think it would be better for us all to join together to create one beautiful song that embodies who they are and what they want to say. Then they will get on stage and sing this song with me," she said. The festival is on April 26 at 6 p.m. at the Givens Performing Arts Center. The center is located at 1 University Drive in Pembroke. Children under five are free and tickets are $10 for adults or $5 for students with a valid ID. For more information visit www.unc.edu/gpac of call 910-521-6634. Star Nayea, who has won multiple awards for her powerful and moving music, is set to perform at the event. ERINN CRIDER, Staff Writer. COM- MENTS? Editor@upandcomingweekly. com. 910.484.6200. Observe Tax Freedom Day by Making Tax-smart Investments by STEVE MCDAVID Use the concept of Tax Freedom Day to find ways to reduce the taxes associated with your investments.