How to Be More Proactive with Your Tax Planning This Year
It’s always a smart idea to get ahead of the game when it comes to tax planning. A common complaint we receive from a number of our clients is that they do not feel as though their CPA is being proactive in managing their taxes.
Take things into your own hands and help them help you.
We encourage you to consider the following so you can cultivate a more positive tax experience this year.
Capital Gains
Almost everything you own and use for personal or investment purposes is a capital asset. Examples include a home, a business, personal-use items like household furnishings, and stocks or bonds held as investments. How much these gains are taxed does depend on how long you held the asset before selling, but there are several other factors to consider as well.
Having a solid understanding of your long-term and short-term capital gains when meeting with your CPA will allow you to reap the benefits from your investment portfolio and help you save big.
Income
Gathering all your income paperwork in one spot—like your W-2, 1099s, K1s, capital gain, interest, and dividends paperwork—is always a good practice in tax planning. In fact, it’s paramount to efficiently and effectively gauge the best tax strategies to tackle your financial situation and to adhere to the slew of changes in this year’s tax code.
Charitable Contributions
While most people donate to charity simply to give back, a nice tax deduction can help you give more money if you so choose. With more and more people utilizing the standard deduction, fewer people are getting a tax break for their charitable giving.
Take a moment to think before writing that check—while it’s important to give back to your community and the charities of your choice, you have the power to make it a win-win situation. Consulting with Morgan Rosel for your tax planning to discuss all your options may be the best move. We will walk you through all your options so you can support the charities you care about while also utilizing the best methodology to garner a sizeable tax break.
Self-Employment
If you’re self-employed, it’s integral to be especially vigilant so you can know where to save money and grow your profits. For example, if you are looking for additional write-offs for your business, but don’t have a retirement plan—even if it’s just for you or you and your spouse—there are vast opportunities within the retirement planning space that can be advantageous to you. Of course, since we are working within the ever-complicated U.S. tax code, there are several moving parts and things are constantly changing. There is a laundry list of matters to consider when you are tax planning as a self-employed individual. Morgan Rosel can help simplify it for you in order to clarify how your personal situation works within the current U.S. tax code.
Insurance policies and annuities
It can be challenging to know if the insurance and annuity policies you are currently enrolled in are the best fit for your financial situation. This is especially true since interest rates are dropping so low. With our vast expanse of resources, knowledge, and experience, we can help you pin down the most cost-effective insurance policy. This will give you something reliable to fall back on should life take an unexpected turn.
Health Savings Accounts
Introduced about two decades ago as a tax-preferred way for working Americans to pay out-of-pocket health care costs, Health Savings Accounts (HSAs) are gaining popularity as a versatile retirement savings tool. In other words, an HSA lets you save money to pay out-of-pocket health care costs in a more tax-advantageous manner.
If you have a high-deductible health insurance plan and you don’t have a Health Savings Account, you could be missing out on several thousand dollars-worth of savings from the government! We can give you the advice and tools you need to change that.
Roth Conversions
Deciding whether to convert to a Roth IRA hinges on issues like your tax rate now versus later, the tax bill you’ll have to pay to convert, and your financial goals. Let us help you evaluate the tax implications of your IRA account options so that you can find the best fit.
An Easier, Smoother Tax Experience Every Time
We want you to dive into every new tax year feeling confident and secure about your financial future. All of us here at Morgan Rosel are experts when it comes to everything and anything finance. We would be happy to speak with you before you meet with your accountant or even arrange for a meeting with them on your behalf! Whatever you decide, we will help ensure that every facet of your financial situation is optimized to simultaneously strengthen your finances and save you money come the tax deadline.
This commentary reflects the personal opinions, viewpoints and analyses of the MorganRosel Wealth Management, LLC (“MRWM”) employees and guests providing such comments, and should not be regarded as a description of advisory services provided by MRWM or performance returns of any MRWM Investments client. The views reflected in the commentary are subject to change at any time without notice. Nothing on this website constitutes investment advice, performance data or any recommendation that any particular security, portfolio of securities, transaction or investment strategy is suitable for any specific person. Any mention of a particular security and related performance data is not a recommendation to buy or sell that security. MRWM manages its clients’ accounts using a variety of investment techniques and strategies, which are not necessarily discussed in the commentary. Investments in securities involve the risk of loss. Past performance is no guarantee of future results. MRWM may recommend the services of a third-party attorney, accountant, tax professional, insurance agent, or other specialist to clients. MRWM is not compensated for these referrals.