As Thanksgiving approaches, November offers a perfect moment for reflection—not only on what we’re thankful for but also on ways to strengthen our financial future. Just like planning a Thanksgiving feast, setting aside time for year-end tax planning can help you get organized, maximize benefits, and reduce potential liabilities. Here are some smart, timely tax tips to help you close out 2024 with gratitude and confidence.
1. Be Thankful for the Power of Tax-Deferred Savings
If you have a 401(k), IRA, or other retirement account, November is the time to double-check your contributions. Tax-deferred savings accounts can reduce your taxable income, meaning you’ll be giving yourself a break come tax time while you save for the future. Consider “topping up” retirement contributions before year-end to make the most of these valuable tax-saving tools.
2. Show Your Generosity: Charitable Contributions
One of the best ways to give back—and potentially lower your tax bill—is through charitable contributions. Cash donations, supplies, or appreciated assets like stocks can all qualify for tax deductions when given to eligible charities. Be sure to get a receipt or confirmation for every donation, and give with intention, knowing that these contributions not only support important causes but may also offer significant tax savings.
3. Harvest Thanks (and Losses) with Strategic Investing
If the market has left you with a few investments that didn’t perform as hoped, you might consider tax-loss harvesting. Selling losing investments can offset capital gains, lowering your tax liability. A wise tax strategy is like a bountiful harvest—it's about gathering what’s beneficial and trimming what’s not. Consult with your advisor about whether tax-loss harvesting might be a fit for your financial goals.
4. Prepare for a “Feast” of Deductions
From medical expenses to business costs, November is a good time to organize receipts and documents that may translate into deductions. If you’ve been tracking these expenses throughout the year, now’s the time to review what’s eligible. Remember, even smaller items, like job-related supplies or medical travel expenses, can add up to meaningful savings.
5. Savor the Benefits of Family Gifts
The holiday season often means giving, and if you’re looking to reduce your estate’s tax burden, consider making tax-free gifts to loved ones. For 2024, the IRS allows up to $17,000 in gifts per recipient without triggering gift taxes. It’s a wonderful way to share your wealth with family while also reducing future tax obligations.
6. Make Room for Upcoming Tax Law Changes
Tax laws are like the perfect pie recipe—they’re always evolving. Staying informed of changes in tax legislation can help you make strategic adjustments. For example, some credits and deductions may phase out next year or adjust due to inflation. Reach out to a tax advisor to discuss any potential changes tha
t could impact your strategy.
——————————————————————————
Need Help Wrapping Up the Year on a Tax-Smart Note?
At Collins & Collins Tax Advisors, we’re thankful for the trust our clients place in us to navigate their tax and financial goals. We’d love to support you with expert insights and personalized strategies as you wrap up 2024. From retirement planning to end-of-year deductions, our team is here to help you make the most of the season and head into the new year with confidence.
Contact us today to set up a year-end planning session. Let’s give thanks for the opportunities, maximize your savings, and secure your financial future.
As you enjoy the warmth of the season with loved ones, a few small steps in tax planning can make a big difference. Just like Thanksgiving, thoughtful preparation now ensures you can reap the rewards later. From all of us at Collins & Collins Tax Advisors, Happy Thanksgiving—and here’s to a financially fruitful year ahead!
Comments