Thu09182014

News

Meet the Mountain View City Council candidates

Meet the Mountain View City Council candidates


Nine candidates have filed to run for three open seats on the Mountain View City Council in the Nov. 4 election – none of them incumbents. The Town Crier asked them to introduce themselves to readers in the following Q&A format. We knew the...

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Schools

LASD committee looks to rank campus improvement projects

LASD committee looks to rank campus improvement projects


Traci Newell/Town Crier
The Los Altos School District’s newly expanded Facilities Advisory Committee met for the first time last week. The 28-member committee’s first task is to prioritize campus improvement projects.

The Los Altos Scho...

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Community

Sports

New-look Lancers find their footing

New-look Lancers find their footing


Ellie Van Houtte/Town Crier
St. Francis High’s Jenna Adams, left, and Carly Deale attempt to bump the ball Friday night. The juniors combined for 28 kills.

This year’s St. Francis High girls volleyball team faintly resembles last season’s squad ...

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Special Sections

MV Whisman teachers cite low pay

MV Whisman teachers cite low pay


Ellie Van Houtte/Town Crier
An estimated 75 supporters of higher teacher pay turned out for the Sept. 4 Mountain View Whisman School District board meeting.

Teachers, trustees and administrators are recovering from a dramatic Mountain View Whism...

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Business

Skin rejuvenation studio joins Rancho

Skin rejuvenation studio joins Rancho


Ellie Van Houtte/Town Crier
Esthetician Marjan Kashi showcases one of the treatment rooms at her new studio, Pure Serenity Skincare at Rancho Shopping Center. Kashi provides services including microdermabrasion and various light and heat energy the...

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Books

A woman's perspective on the Greatest Generation

A woman's perspective on the Greatest Generation


During World War II, Virgilia Short Witzel, a young mother and U.S. Navy officer’s wife, grappled on the home front in Menlo Park with wartime rationing, shortages and loneliness. During the ensuing Cold War, she experienced adventure and misadventur...

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People

JERALD (JERRY) NELSON CHRISTIANSEN

JERALD (JERRY) NELSON CHRISTIANSEN

Resident of San Jose and Los Altos, California

July 21, 1931 to August 4, 2014

Born in Arimo, Idaho, to Jerald Emmett and Rebecca Henderson Nelson Christiansen. Raised in Davis and Riverside, California, with summers in Downey, Idaho, and in Loga...

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Travel

LA photographer spends a night with cranes – and moose – in Alaska

LA photographer spends a night with cranes – and moose – in Alaska


Sandy Powell/Special to the Town Crier
Los Altos resident and bird photographer Sandy Powell recently visited Homer, Alaska, to photograph Sandhill cranes, below. While there, Powell also encountered moose, left.

Los Altos resident Sandy Powell, a...

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Stepping Out

Pear puts on a pair of plays

Pear puts on a pair of plays


J. Smith/Special to the Town Crier
Dan Kapler (as Teddy) and Betsy Kruse Craig (Trish) star in Pear Avenue Theatre’s “House.”

The Pear Avenue Theatre production of two interlocking comedies by Alan Ayckbourn – “House&...

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Spiritual Life

Back to Church Sunday offers opportunity to recommit

The children in Los Altos are back to school, and I can still hear parents cheering. Summer is officially over, even if the calendar doesn’t quite think so.

Parents have attended Back to School nights to meet their children’s teachers. B...

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Magazine

Los Altos Hills home showcases resort-inspired living

Los Altos Hills home showcases resort-inspired living


Courtesy of Spectrum Interior Design
In place of a more traditional fireplace, this modern living room features a linear-flame firebox that emits heat while offering a sculpturelike design element.

After traveling the world and visiting a host...

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Tax gain harvesting a good strategy to avoid fiscal cliff

 

You may be familiar with the term “tax loss harvesting.” Toward the end of each year, many investors routinely sell assets such as stocks or mutual funds with embedded losses to offset the current taxes they will have to pay on gains from other assets.

This strategy generally works well during periods of steady or declining tax rates. However, if you really wanted to keep those stocks or funds and sold them solely for the purpose of taking tax losses, you would need to buy them back immediately after selling them.

The IRS doesn’t appreciate investors executing this maneuver for the sole purpose of deferring taxes. So they require you to wait 31 days or more before repurchasing the asset (or a substantially identical asset), otherwise they will add the loss to your cost basis and treat the sale as if it never happened. This is the wash sale rule and complying with it can make this strategy a bit tricky to execute.

This year we are facing the so-called fiscal cliff. Among other things, the 15 percent long-term capital gains tax rate has the potential to increase to 20 percent if Congress fails to restore some or all of the tax cuts set to expire Dec. 31. In addition, married taxpayers with incomes more than $250,000 will see their capital-gains tax rate go up an additional 3.8 percent to fund the Affordable Care Act (this one is a sure thing). Under these circumstances, tax loss harvesting probably doesn’t make sense. But you can do the reverse (tax gain harvesting), and it’s completely acceptable to the IRS.

The strategy involves selling assets with embedded long-term gains before the end of 2012, then immediately buying them back. The gains accumulated since the assets were originally purchased will be taxed this year at the current 15 percent rate, and any future gains will be taxed at the higher 2013 rates. Not only is this strategy simple to execute, it does not run afoul of the wash sale rule, because that applies only to losses, not gains. (The IRS is perfectly happy when you make your tax payments sooner rather than later.)

It’s important to remember that this strategy applies only to investments held in taxable accounts, not in retirement accounts like IRAs or 401(k)s. Because the money you put into the latter accounts was never taxed (except under certain circumstances), the IRS doesn’t care how much you paid for your investments. You will be taxed at the ordinary tax rates when retirement account money is withdrawn.

If you are a high-income taxpayer, tax gain harvesting in 2012 could save you at least 3.8 percent in taxes on your investments, unless tax rates go down within the next five years or so (a pretty unlikely prospect). For everyone else, you need to balance your expectations of higher tax rates – what are the odds that our lawmakers will reach a deal before the end of the year? – with your own cash-flow needs for this year and next. Don’t wait too long before having this conversation with your tax accountant or financial planner.

Los Altos resident Artie Green is a Certified Financial Planner with Cognizant Wealth Advisors. For more information, call 209-4062.

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