If you are wanting to save money for retirement a fixed tax deferred annuity may be best option for you. With a tax-deferred annuity you don't pay taxes until you make a withdrawal or begin receiving annuity income. This can allow you to accumulate a greater amount of money over an extended period of time. You should think carefully though before putting money into a tax-deferred annuity. If money is needed before age 59 and you withdrawal money IRS may apply heavy penalties. In addition insurer may also impose its own withdrawal penalties which are often cause surrender fees.

You can also purchase what is called an immediate annuity. When you purchase an immediate annuity you make a one-time payment and distributions usually begin within 30 days. Immediate annuities can be fixed or variable. Because an immediate annuity can provide stable income payments guaranteed for a selected period of time, this is a good option if you need a financial vehicle that can provide guaranteed income for life.

Before purchasing an annuity is important to speak with a professional financial adviser so you have an understanding of various tax consequences of an annuity as well as expenses which may be associated with contract.

Property Records - Get A Filing Cabinet

You may need to get a filing cabinet if you hold property for an extended period of time. For example, assume that you purchased a home in 1980 for $100,000 and made $50,000 in improvements over years. You need to keep purchase records, mortgage statements and receipts that relate to improvements. When you sell home, you will need records to determine tax consequences of sale, to wit, your basis (original cost plus improvements) and profit. If IRS decides to take a closer look at reported profit, you will need to provide your tax records to support your claims. Once you actually sell property, it is recommended that you keep all of tax records for an additional six years.

Divorce

Make sure you keep copies of all of your financial documents, tax returns and supporting documents if you get divorced. You should also keep copies of all divorce agreements and court orders that cover property and financial issues. When couples divorce, tax and credit consequences can be nightmarish. If you don’t keep records, you will have to ask your ex-spouse for them. Get records now to avoid doubling your misery!

Hopefully, you will never need to show your tax records to IRS. If you are one of unlucky few that is audited, your tax records should keep your feet out of fire.