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10 Helpful Year-End Tax Tips

Plan Ahead for Changes in Federal Tax Laws

 

Changes due to the new tax legislation passed in late 2017 is a smart place to start when thinking about year-end tax preparation Brooklyn businesses and residents need. For the tax service Brooklyn trusts, Tax Town of Brooklyn offers comprehensive expertise to reduce your tax burden. In Brooklyn NY, residents also need to consider using a CPA Brooklyn residents have relied on for years to do tax returns with precision and accuracy.

How can you help the tax service Brooklyn counts on when preparing your return? Here are 10 helpful year-end Brooklyn NY tax tips.

  1. Make Last-Minute Contributions to Charity

Consider making year-end contributions to your favorite nonprofit organizations. Be sure to get a receipt for any gifts you make, either by cash, check, or property.

  1. Contribute to IRAs, HSAs

Another way to be smart with your tax preparation Brooklyn is to make contributions to a traditional Individual Retirement Account (IRA) or health savings account (HSA). IRA contributions can be made until April of the following year while traditional 401(k), 403(b), and HAS contributions need to be made by December 31.

  1. Sell Securities

If you’re facing a big net capital gain for the year, selling off some securities can reduce the gain or create a net loss for the year. It’s best to check with an investment advisor or CPA Brooklyn before doing so, as there are rules that prohibit you from buying similar stocks within 30 days before or after the selloff.

  1. Hold off on Mutual Funds

While individual stocks might be a good call, be wary about selling mutual funds. You could still incur a bill for year-end dividends for mutual funds even if you recently purchased the funds.

  1. Avoid the Kid Tax

Kid tax rules are so called because they were designed to prevent parents from shifting investment income to children, who usually are taxed in a lower tax bracket. Be careful about giving the kids stocks to sell to pay for college, for example, as you may be hit with a 15 percent tax rate on a gain if unearned income exceeds $2,100.

  1. Use Flexible Spending

Flexible spending accounts are a great way to defer income to pay for medical or child care expenses. Rules vary on using these funds. Some employers allow for a grace period to spend some money set aside in one year until early in the next. Others don’t, so don’t let that money go to waste!

  1. Defer Income

If you’re a business owner or will receive a year-end bonus, consider deferring some of that income until next year. It can save you a lot of money depending on where you land in terms of tax brackets.

  1. Get It Together

Smart gathering your paperwork, receipts, and documents, and know where you’ll be getting W-2s from so you can be ready to file as soon as possible.

  1. Fund College

Consider opening a 529 savings plan to contribute funds, tax-free, to a college-aged child in your life. You can contribute up to $14,000 per child, per year ($28,000 if married).

  1. Choose an Expert

Select a proven trusted tax preparer like Tax Town of Brooklyn to get your taxes done properly and accurately.

If you are looking for the Tax Service Brooklyn residents trust, turn to the experts at Tax Town of Brooklyn.

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