Last Minute Tax Strategies
Well, I'm a lot of things, but a CPA isn't one of them. Having said that collaborating on tax strategy is a significant part of the work I do as portfolio strategy has tax consequences. A few things I encourage every client to consider BEFORE filing as you can still take many of these actions after Dec 31 has passed by.
1) Examine your deductions carefully. The tax code changes may have modified things a bit but meals, travel, home offices, vehicle, and electronics deductions are still alive and well. If you would like access to a video of our webinar on getting familiarized with the new tax code email me!
2) Use your retirement products. In many cases this can happen after Dec 31 but before your filing. If you're self employed engaged a data driven comparison of the 401K, SEP, and Roth options. The tax code changed things, you are likely to be surprised by your findings. If you are not actively putting these products to work you are leaving thousands of dollars unnecessarily exposed to tax liability.
3) Use a healthcare savings account. Until the filing deadline you have a chance to remove thousands of dollars of tax liability by creating a completely tax free savings account. This is one of the few aspects of the healthcare related governance that I actually like. No required distributions, lower health insurance deductibles, and tax free withdraws when allocated to heath care spending. If you bank too much it can be applied in retirement making this a more powerful vehicle than many of the retirement products on the market today.
4) Is taking more time to file so you may audit and tweak your return likely to be advantageous? If so file the extension. You may be less likely to be audited and will get the most bang for your buck. Just remember extensions are for the icing, not the payment. Estimate your liability and submit that payment with your return.
This is just the tip of the iceberg. Compound the extra savings lean tax strategies produce for a 20-40 year period at 6-10%. This is a big deal. It's worth a few bucks and couple hours of your time.