Patten and Company

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When Should You Take Social Security Benefits?

If you’re nearing retirement, you’ve likely paid into the Social Security system for the duration of your career. It’s only fitting that you cash in on the benefits you’ve long been contributing to, but when should you start receiving benefits — at the first available date, at the latest date, or somewhere in between?

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Real estate investor vs. professional: Why it matters

Income and losses from investment real estate or rental property are passive by definition — unless you’re a real estate professional. Why does this matter? Passive income may be subject to the 3.8% net investment income tax (NIIT), and passive losses generally are deductible only against passive income, with the excess being carried forward.

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Are income taxes taking a bite out of your trusts?

If your estate plan includes one or more trusts, review them in light of income taxes. For trusts, the income threshold is very low for triggering the: Top income tax rate of 39.6%,
Top long-term capital gains rate of 20%, and Net investment income tax (NIIT) of 3.8%.

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