Principal tax savings fund

The subject matter in this communication is educational only and provided with the understanding that Principal ® is not rendering legal, accounting, investment advice or tax advice. You should consult with appropriate counsel or other advisors on all matters pertaining to legal, tax, investment or accounting obligations and requirements.

Karvy Distribution Karvy Comtrade Ltd Karvy Financial Services Ltd Karvy Capital Ltd Karvy Global Services Karvy E-commerce Services Karvy GSP The Finapolis Karvy Insights Ltd Karvy Insurance Repository Karvy Analytics Ltd Karvy Private Wealth Karvy Forex & Currency Private Ltd Karvy Data Management Services Ltd Karvy Investor Services Ltd Compliance Officer: Srikrishna Gurazada | Contact No: Investor Grievance Cell Email ID for Broking: Investor Grievance Cell Email ID for DP: Kind attention Investors! As per SEBI’s instructions, we request you to beware of bogus firms promising huge profits through unsolicited SMS. Kindly don’t trust such kinds of messages from any unauthorized persons. Prevent Unauthorized Transactions in your Trading/Demat account --> Update your Mobile Number and Email ID with your Stock Broker/Depository Participant. Receive alerts on your Registered Mobile for all debit and other important transactions in your Trading/Demat account directly from Exchange/NSDL/CDSL on the same day...................... in the interest of investors. | .................Dear Client in pursuant to SEBI circular you are requested to update your Aadhaar card details in your KYC................. | Prevent Unauthorized Transactions in your Trading/Demat account --> Update your Mobile Number and Email ID with your Stock Broker/Depository Participant. Receive alerts on your Registered Mobile for all debit and other important transactions in your Trading/Demat account directly ...

Tax deduction: reduces the total income your taxes are based on. • Example: $50,000 taxable income – $2,000 tax deduction = $48,000 new taxable income Tax credit: reduces the total income tax you owe. • Example: $10,000 owed in federal income tax – $2,000 tax credit = $8,000 new total owed 2. Increase retirement account contributions to reduce taxable income. Traditional IRA and 401(k) or 403(b) contributions are typically made with pre-tax dollars, so adding to either can result in tax savings by reducing taxable income. 4 strategies that help you save for retirement and save on taxes Self-employed or a business owner? SEP or Simple IRA 50 or older? Catch-up contributions (if allowed by your plan) to a 401(k) or 403(b) (an additional $7,500 for 2022) or IRA (an additional $1,000). Tax-free retirement withdrawals? A Roth IRA or Roth contributions to a 401(k) (if available): Set up with post-tax dollars now so you can make qualified tax-free withdrawals later. More retirement savings dollars? 401(k) or 403(b): Boost contribution levels. 3. Add to 529 college savings. 529s offer potential tax savings in two ways: While contributions are made with after-tax dollars, earnings are tax-deferred while invested—and money you use for qualified educational expenses isn’t taxed. Those 529 contributions may also qualify for 4. Contribute to your health savings account (HSA). If you’re on a high deductible health plan (HDHP) through your employer, you may have access to an HSA to save ...

Your financial goals will change throughout your life. Take Types of 529 plans 529 type Used for To note 529 college savings plans Qualified education expenses such as tuition, room and board, mandatory fees, textbooks, and even computers You designate how and where to spend the money, so it’s both more common and more flexible. 529 pre-paid tuition plans Prepaid tuition and fees (in lump sums or installments) at today’s rates at eligible public and private colleges and universities While you lock in prices and can cover up to five years of tuition, you cannot transfer the funds elsewhere. “That’s the downside; a lot are very state specific,” says Kevin Hansen, knowledge hub director at Principal ®. 529 college savings plan benefits and features Are 529 plan contributions tax deductible? Contributions are made with after-tax dollars. Are there other tax benefits to 529 plans? Earnings grow on a tax-deferred basis, and you don’t pay federal taxes on 529 plan withdrawals when the money is used for qualified educational expenses. What are 529 plan qualified education expenses? Tuition, fees, books, computers and related equipment, supplies, special needs, room and board for half-time students, and up to $10,000 in tuition expenses at private, public, and religious K-12 schools (state dependent). Who controls the 529 savings plan account? The account owner, until the funds are withdrawn. (Other donors, such as grandparents, can also set up 529s.) Can I change 529 beneficiaries...

For this assessment year (FY 2020-21 / AY 2021-22), the Government has provided investors the option of sticking to the current income tax rates (as per their income slabs) and claiming exemption like Section 80C, 80D, HRA etc. or moving to the new tax regime with lower tax rates for incomes below Rs 15 lakhs but giving up most of the exemptions. You should do your tax calculations as per the old and new tax regimes according to your personal situation and decide which regime is more advantageous. In our view, tax planning should not be an exercise in isolation. You should consider your long term financial goals in tax planning. Equity Linked Savings Schemes or ELSS is mutual fund schemes which qualify for tax savings under Section 80C of Income Tax Act, 1961. You can claim up to Rs 1.50 lakhs deduction from your taxable income by investing in ELSS funds. ELSS investments have a lock-in period of 3 years. If you are investing in ELSS through Systematic Investment Plans, each SIP installment will be locked in for 3 years from the date of investment. Historical data shows that ELSS has been the best performing tax saving investment over a sufficiently long investment horizon. ELSS investments not only enable you to save taxes but also create wealth for your long term financial goals. If you had invested Rs 1 Lakh in Principal Tax Savings Fund at its inception in 1996, your money would have multiplied over 30 times to more than Rs 33 Lakhs. Scheme Overview Principal Tax Savin...

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Tax deduction: reduces the total income your taxes are based on. • Example: $50,000 taxable income – $2,000 tax deduction = $48,000 new taxable income Tax credit: reduces the total income tax you owe. • Example: $10,000 owed in federal income tax – $2,000 tax credit = $8,000 new total owed 2. Increase retirement account contributions to reduce taxable income. Traditional IRA and 401(k) or 403(b) contributions are typically made with pre-tax dollars, so adding to either can result in tax savings by reducing taxable income. 4 strategies that help you save for retirement and save on taxes Self-employed or a business owner? SEP or Simple IRA 50 or older? Catch-up contributions (if allowed by your plan) to a 401(k) or 403(b) (an additional $7,500 for 2022) or IRA (an additional $1,000). Tax-free retirement withdrawals? A Roth IRA or Roth contributions to a 401(k) (if available): Set up with post-tax dollars now so you can make qualified tax-free withdrawals later. More retirement savings dollars? 401(k) or 403(b): Boost contribution levels. 3. Add to 529 college savings. 529s offer potential tax savings in two ways: While contributions are made with after-tax dollars, earnings are tax-deferred while invested—and money you use for qualified educational expenses isn’t taxed. Those 529 contributions may also qualify for 4. Contribute to your health savings account (HSA). If you’re on a high deductible health plan (HDHP) through your employer, you may have access to an HSA to save ...

Your financial goals will change throughout your life. Take Types of 529 plans 529 type Used for To note 529 college savings plans Qualified education expenses such as tuition, room and board, mandatory fees, textbooks, and even computers You designate how and where to spend the money, so it’s both more common and more flexible. 529 pre-paid tuition plans Prepaid tuition and fees (in lump sums or installments) at today’s rates at eligible public and private colleges and universities While you lock in prices and can cover up to five years of tuition, you cannot transfer the funds elsewhere. “That’s the downside; a lot are very state specific,” says Kevin Hansen, knowledge hub director at Principal ®. 529 college savings plan benefits and features Are 529 plan contributions tax deductible? Contributions are made with after-tax dollars. Are there other tax benefits to 529 plans? Earnings grow on a tax-deferred basis, and you don’t pay federal taxes on 529 plan withdrawals when the money is used for qualified educational expenses. What are 529 plan qualified education expenses? Tuition, fees, books, computers and related equipment, supplies, special needs, room and board for half-time students, and up to $10,000 in tuition expenses at private, public, and religious K-12 schools (state dependent). Who controls the 529 savings plan account? The account owner, until the funds are withdrawn. (Other donors, such as grandparents, can also set up 529s.) Can I change 529 beneficiaries...

For this assessment year (FY 2020-21 / AY 2021-22), the Government has provided investors the option of sticking to the current income tax rates (as per their income slabs) and claiming exemption like Section 80C, 80D, HRA etc. or moving to the new tax regime with lower tax rates for incomes below Rs 15 lakhs but giving up most of the exemptions. You should do your tax calculations as per the old and new tax regimes according to your personal situation and decide which regime is more advantageous. In our view, tax planning should not be an exercise in isolation. You should consider your long term financial goals in tax planning. Equity Linked Savings Schemes or ELSS is mutual fund schemes which qualify for tax savings under Section 80C of Income Tax Act, 1961. You can claim up to Rs 1.50 lakhs deduction from your taxable income by investing in ELSS funds. ELSS investments have a lock-in period of 3 years. If you are investing in ELSS through Systematic Investment Plans, each SIP installment will be locked in for 3 years from the date of investment. Historical data shows that ELSS has been the best performing tax saving investment over a sufficiently long investment horizon. ELSS investments not only enable you to save taxes but also create wealth for your long term financial goals. If you had invested Rs 1 Lakh in Principal Tax Savings Fund at its inception in 1996, your money would have multiplied over 30 times to more than Rs 33 Lakhs. Scheme Overview Principal Tax Savin...

Karvy Distribution Karvy Comtrade Ltd Karvy Financial Services Ltd Karvy Capital Ltd Karvy Global Services Karvy E-commerce Services Karvy GSP The Finapolis Karvy Insights Ltd Karvy Insurance Repository Karvy Analytics Ltd Karvy Private Wealth Karvy Forex & Currency Private Ltd Karvy Data Management Services Ltd Karvy Investor Services Ltd Compliance Officer: Srikrishna Gurazada | Contact No: Investor Grievance Cell Email ID for Broking: Investor Grievance Cell Email ID for DP: Kind attention Investors! As per SEBI’s instructions, we request you to beware of bogus firms promising huge profits through unsolicited SMS. Kindly don’t trust such kinds of messages from any unauthorized persons. Prevent Unauthorized Transactions in your Trading/Demat account --> Update your Mobile Number and Email ID with your Stock Broker/Depository Participant. Receive alerts on your Registered Mobile for all debit and other important transactions in your Trading/Demat account directly from Exchange/NSDL/CDSL on the same day...................... in the interest of investors. | .................Dear Client in pursuant to SEBI circular you are requested to update your Aadhaar card details in your KYC................. | Prevent Unauthorized Transactions in your Trading/Demat account --> Update your Mobile Number and Email ID with your Stock Broker/Depository Participant. Receive alerts on your Registered Mobile for all debit and other important transactions in your Trading/Demat account directly ...