Tag: Gifting

More Year-Ahead Tax Planning

Following on last week’s 2023 Year-End Tax Planning come several key tax moves to consider over the next year or two. These moves do NOT need to be made by year-end 2023 but still need to be top of mind, especially for those in higher tax brackets and those having accumulated significant savings.

Plus, for those approaching retirement and looking to accumulate tax-free monies down the line, there are considerations too. Why bring up this topic now? Because the 2017 tax cuts, set to expire in 2025, did lower the top tax bracket AND expanded the very reasonable 24% tax bracket. Use the lower brackets while they still exist.

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2020 Contribution and Gift Limits

A handful of updates for 2020 IRA & 401k contribution and gift limits:

  • For Traditional IRAs and Roth IRAs the 2020 contribution maximum remains the SAME in 2020 as in 2019: $6,000 (plus $1,000 to total $7,000 for those age 50 and over).
  • REMEMBER!! IRA account contributions can be made all the way up until April 15th for the previous tax year.
  • That means that you have until April 15, 2020 to make an IRA contribution for 2019.
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It’s Never too Early to Plan

A couple of planning “gems” to pass along from the plethora of great financial news reporting* on the new Tax Plan.

Tax Planning

  • Use the Roth 401k whenever it is available at your employer or your company (there are NO income limits for a worker to contribute to a Roth 401k, unlike a Roth IRA).
  • For those of you doing Charitable Gifting AND because of the new, higher Standard Deduction that you may consider using instead of itemizing your taxes, consider doing your Charitable Gifting every OTHER year. This, in effect, “bunches” (to use Greg Iacurci’s word) your charitable gifting into LARGER amounts and then you may only need to itemize in years when your charitable gifting plus deductions is MORE THAN $24,000 for married couples ($12,000 for Single filers).

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