As the year comes to a close, we know your to-do list is filling up with holiday plans and end-of-year tasks. While we’d all rather spend this time enjoying the festivities, it’s important to take some time to focus on year-end tax planning. By tackling a few smart tax moves now, you can reduce your tax liability and avoid unwelcome surprises when tax season rolls around. Whether you’re an individual or business owner, here are some strategies to consider before December 31st.
First, review your retirement contributions. Maximize your 401(k) or IRA contributions if possible. Contributing more before the year ends can lower your taxable income and potentially save you money when you file your taxes.
Next, take a look at your charitable donations. November and December are great times to give, with events like Giving Tuesday and many holiday campaigns. Be sure to keep track of your donations and get receipts—they may qualify for tax deductions.
Do you have a Flexible Spending Account (FSA) or Health Savings Account (HSA), don’t forget to check your deadlines. Max out your HSA contributions and use any remaining FSA funds, as unused amounts may not carry over into next year.
Consider selling some of your investments to offset capital gains or losses. This can be especially helpful if you’ve experienced ups and downs in the market this year.
Finally, start organizing your tax documents early. Begin gathering your paperwork now to save yourself stress and ensure a smoother filing process come tax season.
Set yourself up for success come tax season with smart year-end tax planning. If you need guidance or have questions about your specific situation, David A. Santini CPA LLC is here to help. Reach out for personalized advice and make the most of the last few weeks of 2024!