Before 2022 comes to a close, take some time to review these essential items to ensure you are not missing something that could cause tax trouble when you file your tax return:
1. Take required minimum distributions (RMDs). If you are age 72 or older, you need to take RMDs from certain retirement accounts before Dec. 31st to avoid a 50% penalty! This includes most IRAs (except Roth IRAs) and 401(k)s. Your annual RMD is calculated by dividing the prior Dec. 31st balance by the life expectancy factor provided by IRS tables. 2. Watch for your Identity Protection PIN from the IRS. If you are a victim of tax-related identity theft, the IRS will mail you a one-time use identity protection personal identification number (IP PIN) as added security. The IRS mails IP PINs between mid-December and early January, so look for your IP PIN during this time period. 3. Contribute to retirement accounts. Making contributions to tax-advantaged retirement accounts like a traditional IRA or 401(k) is a great way to lower your tax liability, even if you don’t plan to itemize your deductions! 4. Harvest gains & losses. If you expect to have capital gains from your investments, selling stocks in a loss position to offset the gains will lower your tax liability. In fact, you can claim excess losses of up to $3,000 to decrease your ordinary income, such as wages from your job! Timing matters with investment sales and income taxes, so having a year-end strategy can help lower your tax bill. 5. Make last-minute tax moves. Here are a few ideas worth considering:
Understanding your current situation and having a plan will help maximize your year-end tax savings. "Tax Tips" are published to provide current tax information, tax-cutting suggestions, and tax reminders. If you would like more information on anything in "Tax Tips," or if you'd like to be on our mailing list to receive other tax information from time to time, please contact our office. The tax information contained in this site is of a general nature and should not be acted upon in your specific situation without further details and/or professional assistance. We are trusted CPA advisors servicing Burr Ridge, Hinsdale, Willowbrook, Darien, Naperville, and all Chicagoland area. Do you need assistance with your business and/or personal tax returns? Would you like to have a trusted source for your accounting, allowing you additional time to focus on increasing your business? Do you use QuickBooks, or plan to in the future, for your accounting? We include these in all our service packages, customized to fit your personal or business needs. We are currently accepting new clients. Your initial consultation is free, so you have nothing to lose and everything to gain. Our experienced staff is available to help you streamline your accounting, giving you more free time for yourself. Set up an appointment today by calling (630) 320-3720 or email us at [email protected]. For more free resources, such as Tax Organizers, and Record Retention Schedules, access our website www.monarchaccountinggroup.com. Mia Verc, CPA; Janice Papais, CPA
0 Comments
Your comment will be posted after it is approved.
Leave a Reply. |
BLOGTo better serve our clients and friends, to keep you up-to-date and informed, our blog is a resource for tax tips and overall accounting related articles. We hope you find this useful! CATEGORIES
All
ARCHIVES
September 2023
|