Tax time tips.

• Author: Emerick, Betty
• Position: Managing taxes and retirement plans

This time of year, many of us turn our thoughts and actions to taxes, retirement planning and how we can organize our finances better for 1994. New ways to manage our finances are available from many sources.

For example, software packages let investors trade online, get real-time quotes, do research (through Dow Jones News/Retrieval and Standard & Poor's MarketScope), and manage their portfolios 24 hours a day from desktop personal computers. Investors can also create customized reports and graphs and facilitate tax reports with Schedule D information.

Other tools being offered to assist with taxes and tax planning are:

* Year-end summaries covering the calendar year and listing all buy/sell activity and dividend and interest payments.

* Gain/loss reports tracking realized and unrealized gain/loss information either quarterly or for the year.

* Mutual fund average cost basis reports showing gains or losses for redemptions using the average cost single-category method.

IRAs Going Strong

Besides their taxes, American workers are concerned about retirement planning and the viability of the Social Security system. As a result, individuals retirement accounts (IRAs) continue to be attractive savings vehicles, both for the millions of Americans who can deduct their contributions as well as for those who can't.

The important element in asset-building is the tax-deferred compounded interest that IRAs provide. Rollover IRAs enable investors to preserve tax-deferred compounding and avoid current taxation on IRA distributions.

The significant growth of IRAs from 1981 to 1986 was attributed to individual contributions, but growth from 1986 to the present resulted from rollovers from employee benefit plans. IRA growth should continue strong in the future because these funds are one of the few ways many Americans can maintain tax-deferred growth of payments from their employee benefit plans.

Individuals are also seeking access to a wider range of investment vehicles, such as stocks, bonds and mutual funds, which have historically earned higher rates of return than traditional savings...