Year-End Financial Planning Check List

Editor’s note: Patrick Doherty, CFP® at Reby Advisors, offers readers important end-of-year to-do’s and potential last-minute opportunities to reduce your income taxes.

End of Year Tax Tips

  • Tax loss harvesting: sell investments at losses before December 31st to offset gains and reduce your taxable income.

  • Itemizing versus Standard Deduction: For a married couple, the standard deduction has doubled to $24,000. If your itemized deductions are less than this, consider accelerating charitable giving to go over the $24,000 mark for itemized deductions.

  • Managing your tax bracket: If you expect your adjusted gross income to be higher next year, and in particular if you may enter a higher tax bracket in 2019, then it may not be the best idea to “accelerate” your deductibles because they will have more value in 2019.

  • Accelerated business expenses: hire your kids during the holiday season, buy equipment now instead of next year, pre-pay for services, etc.

  • Qualified Charitable Distribution (QCD): If you have to fulfill required minimum distributions (RMD) and do not need the income to sustain your lifestyle, you may be able to avoid paying taxes on the distributions by directing the funds directly to the qualified non-profit of your choice. Click here to learn more about QCDs.

  • Donor Advised Fund: A Donor Advised Fund may enable you to claim a large deduction in the current year and still have the funds distributed over time. Click here to read our blog article on Donor Advised Funds.

These are just a few examples. I also recommend reading TurboTax’s 10 Easy End of Year Tax Tips to Increase Your Refund and asking your accountant or Financial Planner for their recommendations.

Additional End-of-Year Financial To-Do's

  • If you or someone you know is over the age of 70.5, take your required minimum distributions (RMDs) from your IRA or 401(k)

  • If you plan to make any energy-savings improvements to your home, consider paying for them before December 31st, as they may result in tax savings. Go here for more info: https://goo.gl/oYZwGn

  • Tax credits may also be available for select plug-in vehicles: https://goo.gl/k91QsA

  • If applicable, review your Social Security and Medicare increases for 2019 to help with your income planning and tax bracket management

  • Max out your 401(k) or IRA account contributions (note that you have until April 2019 to contribute to IRA accounts for 2018) before December 31st

  • Check your Flexible Savings Accounts to make sure you don’t lose funds you’ve already contributed – these are “use it or lose it”

  • Consider contributing more to a tax-deductible HSA (health savings account) to reduce your adjusted gross income

  • Get the cost-basis of any inherited or purchased property. This will save you time and money later on when it’s time to sell, whether that’s next year or many years from now.

If there’s anything Reby Advisors can do to help you end the year on a strong note financially, please let us know. As always, please contact Reby Advisors for advice on any of these items or to start 2019 on the right foot financially: (203) 790-4949. Visit Reby Advisors online here.

About the author

As a CERTIFIED FINANCIAL PLANNER™, Patrick focuses on eliminating his clients’ financial worries. His first step is simple: he listens. After gaining an understanding of client concerns, he aims to develop strategies to generate predictable streams of income that support client goals while minimizing the risks that may derail their lifestyle. His knowledge goes well beyond retirement planning and investments. He is a Chartered Special Needs Consultant (ChSNC™) and has a Certification in Long-Term Care (CLTC).


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