Don’t miss out on this moment to minimize your coming tax bills and prepare to maximize your next investment returns for next year too.
This is one of the most pivotal times of the year for investors. It doesn’t matter how much you think you made this year. The tax and investment moves you make right now will dictate your real net. Your money moves right now will also greatly dictate your financial performance over the next year, and beyond.
No matter where you are on your own investment journey, these should be some of the top things on your to do list in the next few days.
Get A Great Accountant
This year more than ever it is going to be vital to have a great accounting team. Not only for general bookkeeping, but for tax preparation.
This year alone there have been over 60 IRS tax changes. This not only means tax hikes, but many new tax calculations and rules. It is a full time job for a team to keep up with them. Don’t even consider trying to do it alone. Not unless you want to seriously overpay the IRS and your state and county tax authorities.
Every penny you spend on the best possible accounting firm is likely to pay you great returns.
If you don’t have a good system, software or bookkeeper in place already, this should also be a top priority. You are going to save a lot more on taxes, enjoy a more consistent process, and have less stress if you have all of your numbers together in advance.
Harvest Your Losses
If any of your investments are down right now, this may be a wise time to exit them. You may be able to use them as a part of your tax loss harvesting plan. Meaning that those losses can be used to offset taxes on other investment gains and earned income.
This may be especially valuable this year as you restructure your investment portfolio away from plans that are coming under fire from new regulations and taxes.
This is where you can even turn a down year into a net positive one.
Maximize Your Contributions
Of course, maximizing contributions to all of your tax saving investment vehicles should be on your list too.
This may include your self-directed IRAs and 401ks, as well as other tax deferring savings accounts, reinsurance plans, trusts, etc.
Remember that the maximum contributions to these accounts have likely been lifted due to inflation this year. Don’t overlook this opportunity.
Help Your Kids Get Ahead
Now is also the time to help your kids get ahead both financially, and with their taxes.
This may include opening and funding tax saving accounts like IRAs for them. Moving assets into trusts, gifting them assets to minimize taxes on their inheritance, and funding some of their early investment choices.
Create A Tax Plan For The Next Year
Hopefully you are already months ahead on these times. If not, there are only a few days left to get them in order. Then work with your accounting and tax pros to create a plan for the next year and beyond. It will streamline your decision making, and maximize your ongoing tax savings and net returns.
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