If you think tax planning is a year-end event, you’re wrong. You should plan your tax strategy year round. In this challenging economy we have to be on our toes even more when it comes to making decisions about our taxes. Some tax laws have changed and maybe your life has also changed. Staying current on tax information is one of the best strategies you can implement into your tax planning system.
If you’re not excited about reading up on tax law changes, I understand completely. The tax planning advice I would have for you would be to use an online tax preparation software company which will do all of the hard work for you. It would be wise to have a tax saving strategy for various situations. There are key areas where a little tax planning can make a very big difference. Develop a tax plan for investments, medical expenses, education expenses, family expansion or reduction, your business, or estate planning. Of course those are just a few of the areas you must consider.
More taxpayers can now take advantage of opening a Roth IRA. The limit of $100,000 of adjusted gross income on converting an IRA into a Roth IRA is now gone. If you think your financial situation in life will be the same or higher when you are in retirement, you will probably want to convert to a Roth IRA.
Purchase Business Assets
Small business owners or self-employed people should consider purchasing new equipment or office furniture. For a limited time there is a 100% write off for new computer equipment.
Make a Donation to Charity
By giving a donation to qualified charities you can reduce your tax. Visit the IRS web site to make sure your charity qualifies and please remember to get a receipt. You must keep all records in an organized fashion and in a safe place.
Investing
Usually you’re planning on managing your capital gains and planning your portfolio. In our current economy planning is largely about making your losses work for you. The real trick is to balance the losses with the gains over the short and long-term.
See if a loved one qualifies for the 0% rate. If you have adult children in one of these brackets, consider transferring dividend producing assets to them. Watch out for the kiddie tax if they’re under age 24.
Online Tax Preparation Software
The best tax planning advice I can give you is to use an online tax preparation software company like TurboTax Online.
If you would like help with financial advice for retirement planning, family tax strategies, home ownership/rental information, stock, bond and mutual fund tax counsel and other tax strategies you will have all of this and more custom tailored to your unique situation in life. Try TurboTax Online today to see what you’ve been missing!
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