December 9, 2014 § Leave a comment
It’s a good time to plan for end-of-year financial options. Having a bit of time, instead of waiting until next year, allows you to keep your eyes open for your personal possibilities. Please speak with your tax advisor when making some of these decisions.
Maximizing retirement – When was the last time you increased the contribution to your 401(k)? The maximum contribution you can make according to the IRS is $17,500. And if you are over age 50 you can add another $5,500 to that for a total if you are over 50 of $23,000. And that is before your employer’s contribution. If you are doing a small percentage and always meant to increase you amount, maybe now is a great time.
Required minimum distributions – If you are age 70.5 have you taken this year’s Required Minimum Contribution? Penalties for NOT taking these contributions are quite steep. If you are required to take an RMD and fail to do so, ‘the amount not withdrawn is taxed at 50%,’ according to IRS.gov
Using flex accounts – If you have a flexible savings account at work and need to use it or lose it, now is the time to get the glasses or getting your teeth cleaned. Even though this time of year is busy, you’ll want to get this done in a way that works for your needs.
Charitable giving – The tax code is written in a way that your generosity is rewarded in a tax benefit to you. So GIVE. All year you have seen difficulties and noticed the organizations that have stood in the gap for those who suffer. Now is the time when you can include these good organizations in your holiday giving.
This is certainly not a complete list of things to keep in mind. But giving yourself time to consider your financial end-of-year options will allow a possibly more directed outcome. (CR10393)