Our weekly roundup of tax-related investment strategies and news your clients may be thinking about.

A checklist for taxable-bond-fund investors

Investors are advised to start building their taxable-bond-fund portfolio with core, intermediate-term funds that could provide diversification benefits, according to Morningstar. Although lower-quality bonds offer higher yields, these are also at a higher risk of being affected during flight-to-quality periods, while lower-quality credits have a tendency to behave more like equities than bonds. Selecting funds with moderate interest-rate sensitivity for the core of a fixed-income portfolio would give investors less volatility, year over year. Investors should pay attention to the prices of funds because those with lower expenses are more successful, said an expert. -- Morningstar

Communication key for advisors, CPAs on investing, taxes

Financial advisors should avoid treating investing separately from tax planning since such an approach could result in providing tax-inefficient decisions, according to the Wall Street Journal. For instance, investors may sell an investment at a wrong time and consequently face a bigger capital gains tax. "I've had clients walk in with huge capital-gains issues, because investment managers sometimes don't have the respect for the tax consequences of what they are doing," says Mackey McNeill of Bellevue, Ky.-based Mackey Advisors. -- Wall Street Journal

Seeing a tax refund as a financial opportunity

Financial advisers say that taxpayers who receive a tax refund can use the money wisely by paying down their credit card debt, according to the New York Times. They may also deposit the money to their emergency savings fund or use it to open one. A tax refund can also be used to shore up funds that can cover at least three months of living expenses. An expert recommends taxpayers who receive hefty tax refunds to adjust their payroll withholding since it means giving an interest-free loan to the federal government. -- New York Times

Opinion: The curious reason why stocks may rise until Tax Day

The stock market is likely to perform well in the first two weeks of April because of the Internal Revenue Service, according to MarketWatch. The federal government has to make sure the marketplace has high liquidity so investors can pay their taxes by the deadline, an expert says. The government will do whatever it can to make "sure the [stock] market holds together as best it can going into Tax Day," the expert says. -- MarketWatch

5 higher taxes for wealthy taxpayers

Higher-income taxpayers are likely to face a hefty 39.6% top tax rate under existing tax rules, according to Yahoo Finance. They are also expected to pay 20% tax rate on capital gains, an additional 0.9% to their payroll tax and 3.8% net investment income tax. However, there are tax deductions and breaks available to them to help them save on taxes. -- Yahoo Finance

This popular last-minute tax move might be wrong for you

Taxpayers may opt to use the Roth IRA, instead of the traditional IRA, in making a last-minute tax deduction move before the deadline of filing returns comes, according to DailyFinance. Although Roth IRA contributions won't be deducted on taxes, it is tax-free and has an offsetting impact, resulting in potentially lower tax bill in retirement. Deduction from a traditional IRA won't also worth much if taxpayers are in a low tax bracket, so these low-income workers should use a Roth IRA to get higher tax savings and make their investment earnings tax-free in the long run. -- DailyFinance

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