As the end of the year approaches, it’s time to focus on one of the most critical financial tasks: year-end tax planning. For both individuals and business owners, taking proactive steps before December 31 can lead to significant tax savings and a smoother filing season.
Maximize Tax Savings
Year-end planning allows you to identify opportunities to reduce taxable income. For individuals, this might mean contributing to retirement accounts, harvesting tax losses from investments, or taking advantage of deductions and credits that expire at year-end. Business owners can explore strategies like accelerating expenses, deferring income, or making purchases that qualify for tax breaks.
Stay Compliant
Tax laws change frequently, and what worked last year might not apply now. Year-end planning ensures you stay updated and avoid surprises during tax season. For example, recent changes in tax brackets, deduction limits, or credits may require adjustments to your financial strategy.
Plan for the Future
Tax planning is not just about the current year; it’s also an opportunity to set the stage for long-term financial health. By aligning your tax strategies with your broader financial goals, you can make better decisions for the year ahead. Business owners, for instance, might consider implementing new retirement plans or restructuring their businesses for tax efficiency.
Avoid the Rush
The earlier you start planning, the more options you have. Waiting until the last minute can limit your ability to implement effective strategies or gather necessary documentation.
Discover various tax strategies to help you save money. Click here to explore actionable strategies tailored for individuals and here for small businesses. Contact your Stephano Slack tax manager/partner at 610-687-1600 or [email protected] to determine if you can benefit from a cost segregation study.
Author John J. Loughlin, Jr., CPA, Partner, leads the Tax & Advisory Services Department at Stephano Slack. He specializes in tax compliance, planning, and projections. His expertise and personalized approach help clients navigate complex tax matters, ensuring peace of mind and optimal outcomes. John can be contacted at 610-710-4045 or [email protected].
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