System and method for forecasting tax effects of financial transactions

Patent metadata

Field	Value
Publication number	US-9773276-B2
Application number	US-84160107-A
Country	US
Kind code	B2
Filing date	Aug 20, 2007
Priority date	Mar 1, 2001
Publication date	Sep 26, 2017
Grant date	Sep 26, 2017

Abstract

A system and method for forecasting tax effects of financial transactions is provided. The system and method include a series of web pages. The web pages allow a user to 1) determine their federal and state tax rates, 2) describe the asset they wish to sell. Additional web pages then display the tax consequences of the sale of the asset along with the details of the calculations used to evaluate those consequences. Still more web pages can be used to describe an asset to buy. In this case, the displayed consequences are expanded to compare the benefit of holding the current asset against the benefit of acquiring the new asset.

First claim

What is claimed is:

1. A computer system for forecasting and comparing financial effects of holding a first asset versus selling the first asset and purchasing a second asset, comprising:
a processor; and
a non-transitory computer readable medium comprising code, executable by a processor, for implementing a method comprising the steps of
generating, with the processor, a first sequence of one or more web pages, wherein the first sequence of the one or more web pages presents a user with an option using a link to compare the financial effects,
in response to selection of the option using the link to compare the financial effects, generating a second sequence of one or more web pages, wherein the second sequence of one or more web pages contains a plurality of fields for the user to enter information describing the first asset, second asset, and user tax rates and wherein the second sequence of one or more web pages further includes a tax rate assistance option that generates a sequence of one or more web pages to assist the user in determining the user's tax rate based on the user's taxable income,
wherein the sequence of one or more web pages to assist the user in determining the user's tax rate based on the user's taxable income comprises fields for user input of information describing the user's tax filing status, taxable income, state income tax rates, and state long term capital gains rates,
in response to receiving information describing the first asset, calculating the financial effects of holding or selling the first asset using information describing the first asset,
in response to receiving information describing the second asset, calculating the financial effects of selling the first asset and buying the second asset using information describing the first asset and second asset, and
generating a third sequence of one or more web pages displaying the financial effects of holding or selling the first asset, wherein the financial effects include investment tips that comprise an amount of time that the first asset must be held to avoid short-term capital gains taxes.

2. The system of claim 1 , wherein the plurality of fields are configured to receive at least one of the following:
a combined federal and state ordinary income tax rate;
a combined federal and state long-term capital gains tax rate;
a first asset ticker symbol;
a date of purchase of the first asset;
a cost per share at purchase of the first asset;
a first load or commission paid at purchase of the first asset;
a number of shares to be sold of the first asset;
a target or estimated price per-share that the first asset will bring when sold; and
a second load or commission to be paid at the sale of the first asset.

3. The system of claim 1 , wherein the financial effects include at least one of the following:
a time the first asset must be held to avoid short-term capital gains taxes and an amount saved by utilizing long-term capital gains tax rates,
an estimated capital gain or loss,
an estimated net proceed from a sale of the first asset, and
an estimated capital gains tax due resulting from the sale of the first asset.

4. The system of claim 1 , wherein the plurality of fields are configured to receive at least one of the following:
a combined federal and state ordinary income tax rate;
a combined federal and state long-term capital gains tax rate;
a first asset ticker symbol;
a date of purchase of the first asset;
a cost per share at purchase of the first asset;
a first load or commission paid at purchase of the first asset;
a number of shares to be sold of the first asset;
a target or estimated price per-share that the first asset will bring when sold;
a second load or commission to be paid at the sale of the first asset;
an anticipated rate of return on the first asset;
a second asset ticker symbol;
an amount to invest of the second asset;
a third load or commission to be paid at purchase for the second asset;
a second anticipated rate of return on the second asset; and
an expected number of years that either the first or the second asset will be held.

5. The system of claim 1 , wherein the financial effects include at least one of the following:
a time the first asset must be held to avoid short-term capital gains taxes and an amount saved by utilizing long-term capital gains tax rates,
an estimated capital gain or loss,
an estimated net proceed from a sale of the first asset,
an estimated capital gains tax due resulting from the sale of the first asset, and
a holding time period for holding the second asset so that the second asset will have a value that would be equal to the value for the first asset if the first asset is not sold.

6. The system of claim 1 , wherein the plurality of fields are configured to receive a target or estimated price per-share that the first asset will bring when sold and the second sequence of one or more web pages includes a link to obtain the current price of the stock to be sold.

7. The system of claim 1 , wherein one or more web pages in the third sequence show the calculations used to calculate the financial effects of selling the first asset.

8. The system of claim 1 , wherein the investment tips further comprise an amount of money saved by delaying the sale of the first asset by the amount of time that the first asset must be held to avoid short-term capital gains taxes and thereby utilizing long-term capital gains tax rates.

9. The system of claim 1 , wherein the method comprises displaying the first sequence of one or more web pages, second sequence of one or more web pages, and third sequence of one or more web pages.

10. The computer system of claim 9 , wherein the investment tips are provided in a textual form.

11. A computer system for forecasting financial effects of a financial transaction, the system comprising:
a processor; and
a non-transitory computer readable medium coupled to the processor, the computer readable medium comprising code, executable by a processor, for implementing a method comprising the steps of
generating a first sequence of one or more web pages, wherein the first sequence of one or more web pages presents a user with a first option of calculating tax on a sale of an asset and a second option of comparing two investment options on an after-tax basis, where a first investment option is continuing to hold the asset, and a second investment option is selling the asset and purchasing a different asset,
wherein the first option and the second option are presented using links in the first sequence of one or more web pages,
in response to selection of the first option, generating a second sequence of one or more web pages, the second sequence of one or more web pages containing fields for user input of information describing the user's tax rates and information describing the asset to be sold,
wherein the second sequence of one or more web pages further presents the user with a tax rate assistance option and, in response to the user selecting the tax rate assistance option, generating a sequence of one or more web pages to assist the user in determining the user's tax rate based on the user's taxable income,
in response to receiving information describing the user's tax rates and information describing the asset to be sold, calculating the financial effects resulting from the sale of the asset to be sold, and
generating a third sequence of one or more web pages displaying the financial effects of selling the asset to be sold, wherein the financial effects include a time the first asset must be held to avoid short-term capital gains taxes and an amount saved by utilizing long-term capital gains t

Assignees

• Foley John T
• Nicklanovich Steven
• Charles Schwab & Co Inc

Inventors

• Foley John T
• Nicklanovich Steven

Classifications

• G06Q20/102

  Bill distribution or payments · CPC title

• G06Q40/10

  Tax strategies · CPC title

• G06Q40/00

  Finance; Insurance; Tax strategies; Processing of corporate or income taxes · CPC title

• G06Q40/06

  Asset management; Financial planning or analysis · CPC title

• G06Q20/207

  Tax processing · CPC title