Tax-Time Considerations Before New Years Eve

Tax-Time Considerations Before New Years Eve

Christmas is over and you may be wondering if your to-do list should have a few tax and financial considerations on it before you celebrate NYE. We suggest you spend a few minutes considering the following ideas:

1. Read up on the  Child Tax Credit if it applies to you, and know its impact on your 2021 tax return.
2. Review your investment portfolio for capital gain and loss planning.
3. Maximize the kiddie tax threshold rules ($2,200 of unearned income taxed at your child’s lower tax rate).
4. Make last-minute contributions to your HSA and retirement accounts to take advantage of the annual contribution limits.
5. Review retirement accounts. Make any required minimum distributions.
6. Review medical and dependent care funding accounts to ensure you do not lose contributions that do not roll over into the new year.
7. Estimate your tax liability and make any final estimated tax payments.
8. Review your W-2 withholdings and file any changes with your employer for the upcoming year.
9. Begin organizing your tax records.
10. Make last-minute charitable donations.

Getting organized this week may save you tax money on your 2021 return. Once the new year starts, it may be too late to impact your 2021 return. We also suggest that you be an early filer in 2022 and by getting organized now, you’ll be in a better position to do just that. Contact your CPA now with any questions.

Happy New Year from DeHoek & Company, PLLC.

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