Year-End Tax Tips

Year-End Tax Tips

It’s almost tax time again! I know, I know.  Try not to get too excited.  Congress has been “thankfully” boring this year regarding tax changes, so this email is a retread from last year.  I’ll send out more specific information regarding the upcoming filing season with our annual letter in January.  Here are a few things to consider doing now.

  1. Max Out Your Retirement Plan Contributions

If you’re not already maxing out your 401K or traditional IRA contributions, this is one of the best ways to reduce your taxable income.  The idea is that you pay tax on the money later when you are retired and have less income, thus less tax.  The downside is that you cannot access the money without penalty until age 59.5.

  1. Reposition Your Investment Portfolio

You can sell losing investments to offset gains from winners.  If you sell a stock you’ve held for less than a year that’s gone up in value, you’ll likely be taxed at ordinary income rates. But sell some investments that have declined in value, and you can offset this gain.

  1. Give to Charity

Most donations to qualified charities count as tax-deductible expenses.  You should keep receipts and records of your donations, which should indicate the amount you’ve donated and the date it was received. Keep copies of all receipts from the charity, credit card statements or cancelled checks that prove your donations in case you are audited.  We also recommend taking photos of your donations as additional documentation.

  1. Flex-Spending Accounts (Health and Dependent Care)

Remember that these plans are “use-it-or-lose-it”, so renew your prescriptions, get your annual check-ups and dental visits done, and pay off or even pre-pay January day care.  Make sure you do this by the end of December or it counts against next-year!


It’s also open enrollment for Obamacare right now, and the penalty for not having health coverage went up again this year … A LOT!  The government is also tightening up on the “easy” excuses it allowed in prior years.

If you have any questions or concerns, please email or call our office.  We are in on Tuesdays and Thursdays through the holiday season and back to full-time in January.