Broker Check

Keep more of your hard-earned income with these tax-saving strategies.

| March 10, 2020
Share |

“If your actions inspire others to dream more, learn more, do more and become more, you are a leader.”

- JOHN QUINCY ADAMS,  U.S. PRESIDENT

With April 15th just around the corner, taxes are on everyone’s mind. ...

Planning is key to saving money on taxes. 

Ask your financial advisor: 

  • How can I improve my current tax situation? 
  • What are the ways to reduce my 2019 and 2020 tax liability?
  • Have I missed any deductions on this year’s tax return?
  • What long-term strategies can be used to lessen my future tax obligation?
  • How does recently passed legislation affect my situation?

Keep More of What You Earn.

It can be easy to get caught up in the “here and now.” Make sure you’re taking a holistic approach to building long-term wealth by integrating tax-saving strategies into your financial picture. There are many ways to reduce your tax obligation and keep more of your hard-earned income.

Max out your employer retirement plan and IRA contributions. Purchase needed items for your home-based business. Hold on to assets longer than one year, and take advantage of long-term capital gains. 

Make your tax preparer aware of all potential deductions, including: long-term care insurance premiums, 529 plan contributions, medical expenses, and charitable donations.

Get Credit for Your Donations. 

Can you currently itemize your deductions? Could you if you bunched your charitable contributions? Keep in mind that not all contributions to nonprofit organizations are tax-deductible. If you want to get tax credit for your donations, ensure the charities you are giving to are designated as 501(c)(3) organizations. 

Also, make sure to keep those receipts. If you donate to charity, Uncle Sam requires written proof. Obtain a receipt for all donations under $250. If you give over $250 in a single day, you’ll need a letter acknowledging your contribution in order to receive a tax credit.

Recent Changes for Those Close to Retirement

With the passage of the “Setting Every Community Up for Retirement Enhancement” (SECURE) Act in December 2019, the maximum age for IRA contributions was removed. As long as you are still working, you can contribute to your employer retirement plan or possibly a Traditional IRA or Roth IRA.  

The SECURE Act also pushed back the age you’re required to begin taking your required minimum distribution (RMD) from 70 ½ to age 72, for those born after July 1, 1949 or after. 

According to MarketWatch.com, “The deadline for making a contribution for your 2019 tax year is April 15, 2020, but you cannot make a contribution for 2019 if you were age 70 1/2 or older as of Dec. 31, 2019. Thanks to the new law, you can make contributions for tax year 2020 and beyond.

Inheriting an IRA or qualified retirement account? 

Did you know you may be able to “stretch” out those required minimum distributions, therefore lowering your required tax in year one? 

The SECURE Act requires certain beneficiaries to liquidate inherited retirement accounts within 10 years. You’ll want to get the details on this when you’re designating beneficiaries on your retirement accounts.

Read more in depth about the recently passed SECURE Act HERE: (https://money.usnews.com/money/retirement/iras/articles/what-is-the-secure-act)

Bring your latest tax return, tax forms and supporting documentation to NFG for review. We may be able to help lessen your tax obligation so you can keep more of what you earn.

Call Nithman Financial Group Today: 405.767.1230.

For a comprehensive review of your personal situation, always consult with a tax or legal advisor. Neither First Allied Securities, Inc. nor any of its representatives may give legal or tax advice.

 

Share |