Last-minute Tax Reminders

6 year-end tips to consider

Key Takeaways

  • Before year-end, accelerate your charitable contributions and pay real estate taxes, state income taxes and deductible medical expenses early.
  • Always consult with a trusted advisor before pulling the trigger on any of the year-end tax tips below.
  • Look for capital gains in the 0 to 15 percent tax bracket and take advantage of the $14,000 annual exclusion on gifts to children and grandchildren.
  • If you’re a business owner, accelerate your operating expenses and highly depreciated capital expenditures.

Hidden Benefits in the Sharing Economy

Key Takeaways

  • 34 percent of the workforce is now doing independent, self-employed work—up from 6 percent 20 years ago.
  • The majority of workers in the sharing (gig) economy are NOT taking advantage of all the saving and tax mitigation benefits they’re entitled to.
  • A Solo 401(k)/Profit Sharing Plan can help many sharing economy workers save for retirement and reduce their taxable income.

IRS “Dirty Dozen” 2016 Tax Scams

Key Takeaways

  • There are three tax systems in the U.S.: one for the informed, one for the uninformed and one for the ill-informed.
  • Before you file, make sure you review the IRS’s “Dirty Dozen” list of tax scams for 2016.
  • An experienced and vetted tax preparer will not only prepare your return the right way, but also can help you avoid being duped by tax scammers.

Saving Taxes in 2016

Key Takeaways

  • Young adults can take advantage of the enhanced child tax credit, the enhanced American Opportunity Tax Credit, and the enhanced earned income tax credit.
  • If you’re over age 50, take advantage of the $6,000 annual “catch up” for your 401(k).
  • Many retirees receive tax-preferred treatment of capital gains. If you are over age 70 1/2, you can also donate up to $100,000 to charity tax-free if the funds are drawn from your retirement plan.