10 Moves to Make Before the End of the Year

For Mark Roberts’ Use: Your 2019 income tax return isn’t due until April of next year… So why would you want to think about it now?

Actually, there are plenty of good reasons to consider your tax situation toward the end of the year. By anticipating your income tax debt, you can take steps to potentially reduce the amount owed. But since these decisions must be made by the end of the day on December 31, get started now.

Make an extra mortgage payment – the interest is deductible, plus if you do this every year you can pay off your mortgage several years early
Make charitable contributions – this valuable deduction can reduce your taxable income, but only if you choose a charity qualified by the IRS
Max out your health savings account contributions, and lower your taxable income – individuals can contribute up to $3,500, while those with a family plan can stash $7,000
Pay medical bills – you can deduct qualifying medical expenses that exceed 10 percent of your AGI
Pay your property taxes – these are also deductible, up to $10,000
Avoid future estate taxes – if you’re concerned about estate taxes after you pass away, you can gift up to $15,000 per person, tax-free each year during your lifetime
Take advantage of investment losses – sometimes it makes sense to sell losing investments to take advantage of the capital gains offsets
Max out your IRA contributions and lower your taxable income – you can contribute up to $6,000 this year, or $7,000 if you’re age 50 or older
Max out 401(k) contributions and lower your taxable income- you can contribute up to $19,000, or $25,000 if you’re age 50 or older
Take your RMD, if you’re over age 70 ½ – if you haven’t done so by the end of the year, you could be subject to a stiff tax penalty

Of course, we definitely don’t recommend that you take tax advice from a blog. These ideas should provide some inspiration for potential pathways to reducing your overall tax debt. But don’t make any decisions without consulting with an expert first. Give us a call if you have any questions, especially regarding retirement plan contributions or required minimum distributions, and we can help you figure out the most beneficial way to proceed.

About the Author: Mark Roberts

In addition to managing clients’ money and giving investment and diversification advice, Mark offers something that “the other guys” don’t - a unique approach to Retirement Tax Strategies and distribution. Time and time again, Mark meets with new clients who tell him they have a great relationship with their financial advisor but have never been offered information on this kind of approach to securing their financial futures. Mark has taken this feedback to heart and works tirelessly to ensure that his strategies focus on taxes and distribution. Mark started selling insurance for a major insurance company right out of high school to help put himself through college. After graduating with a degree in finance, he dove into estate planning on the financial side to set himself apart from other financial advisors. However, as changes were made to estate tax laws over time, Mark shifted his focus to income tax strategies. Mark’s philosophy is “the blue prints are more important than the wall paper or carpet.” The wall paper and carpet represent products like investments and insurance policies, whereas the blue prints represent the strategies. Once strategies that truly fit the client’s needs are put in place, our focus can shift to providing you with the right products. According to Mark, “It doesn’t matter what carpet we use if the walls are not in the right place.” Our approach to money management is designed to generate the largest alpha (quality) with the lowest standard deviation and beta (risk). By doing this, we help provide clients with the highest return on the lowest risk. Generating income for our retirees is also very important. Because withdrawing money from your portfolio hurts the account rather than helping it, our goal is to design income strategies to harm the portfolio the least making the money last longer.

10 Moves to Make Before the End of the Year

10 Moves to Make Before the End of the Year

Share This Story, Choose Your Platform!

About the Author: Mark Roberts