Coronavirus Taxes and Your Investment Strategy

The Internal Revenue Service has extended the deadline to file and pay federal income taxes to July 15, 2020 due to the financial impact of COVID-19. In addition, you can obtain up-to-date information for taxpayers via the Treasury Department at https://home.treasury.gov/coronavirus.
How Long Will Negative Impacts on Investments Last?
This is not the first time a disease outbreak has caused a market correction, which is what we are now facing. In modern times, the most impactful case was the AIDS pandemic in the early 1980s, which effected the market for over five months. Usually, however, such impacts last less than two months, and most financial experts expect a market recovery within the next few months. The proactive financial measures the US and other governments have taken provide a reason for optimism. Still, it is difficult to be sure where the bottom for this market correction lies.
What You Should Be Doing
During periods of instability, we usually recommend leaving investments alone. It is, however, an excellent time to reevaluate your investment goals and to make sure they align and will achieve your aims.
We suggest patience with the current uncertainty in the market, and if at all possible, refraining from withdrawing money from savings or investments. Rather, continue to invest for the long term and contribute gradually. By spending time in the market and sticking to a disciplined plan, you will earn interest on interest received. And make sure you have exercised a sound diversification investment strategy (bonds, equities, cash, and precious metals). If you have uncertainties concerning what direction you should choose with your assets, speak with your tax specialist or financial advisor. If you are a client of ours, we invite you to receive unlimited complimentary tax planning advice.
Professional Tax Services is a locally owned provider serving over 3,500 local residents and businesses. For more information call 661-259-1967 or visit www.protaxservices.com. Through their complimentary EZ2 Thrive program, they provide unlimited free tax planning advice to their clients.
Professional Tax & Financial Services is located at 27451 Tourney Rd., Ste. 160 in Valencia. For more information, please call 661-259-1967. You may also visit www.scvprotaxservices.com.