Hello Everyone,Over the Easter Weekend My Mother-in-law complained that she was paying out nearly half of her income in taxes.I'm shocked and concerned as our income is larger than hers and we aren't paying anywhere near that much.The problem is the capital gains from her investment account.The background of this situation is that my FIL was acredit manager for Dun and Bradstreet and had accumulated a lot of stock in that company over the years.When he died in the 80's my MIL started recieving dividend checks which she needed to live on. This supplimented her ss and a small pension.All was well until a couple of years ago when Dun and Bradstreet cut their dividend. My MIL went into a panic because of the sudden dent in her income. She went to a broker that her friend uses.Here's where the fun starts. The broker gets one percent of what her account earns. He doesn't have to ask her permission to buy or sell anything in her account, per her own instructions to him at the onset.The account makes money alright but the buying and selling are so ridiculous that the capital gains are killing her. She has Smith Barney send her a check automatically each month. From all sources her income is around $40,000 per year-- and she paid $17,000 in taxes this year.I'm NOT a font of knowledge on these matters, but isn't that ratio avoidable? My MIL mailed the broker a copy of her taxes and told him that she can't deal with it.She's 82-years old and doesn't need this stress. Any words of wisdom here? I don't know what to tell her. I suggested she write to the broker and tell him how she feels, for a start.I appreciate your time!Lori-Ann (richbird)
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