2016 Year-End Tax Planning Tips
With a new administration taking shape in our nation’s capital after the elections, you can expect that significant tax reforms will be debated, and perhaps enacted, in the near future.
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2015 Year-End Tax Planning Tips
For most of the last decade, year-end tax planning has been complicated by a great deal of uncertainty. This year is no different.
As things now stand, dozens of favorable tax-law provisions that technically expired after 2014 are in limbo. Some or all of those provisions may be reinstated, even retroactive to the beginning of the year, if Congress enacts new legislation. But there are no guarantees that the nation’s lawmakers will come to an agreement before 2016. Furthermore, even if changes are enacted, they may occur too late for taxpayers to take any meaningful tax action. Stay tuned to our blog for developments on these tax extenders.
We know that taxpayers must contend with a continuing stream of new cases, rulings and regulations on various issues that could affect year-end tax-planning decisions.
With this in mind, Whalen & Company has prepared 2015 Year-End Tax Planning tips for your convenience! Click here to download our 2015 Year-End Tax Planning Letter, which include guidelines for:
- Individual Tax Planning
- Business Tax Planning
- Financial Tax Planning
Be aware that the tax-planning concepts outlined in the attached are only intended to provide an overview. It is recommended that you review your situation with your Whalen & Company, CPAs tax professional.
Your 2015 Tax Planning Should Start Now
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Whether you filed your 2014 income tax return by the April 15 deadline or filed for an extension, you may think that it’s a good time to take a break from thinking about taxes. But doing so could be costly. Now is actually the time you should begin your 2015 tax planning — if you haven’t already.
A tremendous number of variables affect your overall tax liability for the year, and starting to look at these variables early in the year can give you more opportunities to reduce your 2015 tax bill. For example, the timing of income and deductible expenses can affect both the rate you pay and when you pay. By regularly reviewing your year-to-date income, expenses and potential tax, you may be able to time income and expenses in a way that reduces, or at least defers, your tax liability.
In other words, tax planning shouldn’t be just a year end activity. To get started on your 2015 tax planning, contact Whalen. We can discuss what strategies you should be implementing now and throughout the year to minimize your tax liability.
Copyright 2015 Thomson Reuters
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Portability doesn’t preclude the need for marital transfers and trusts
Exemption portability, made permanent by the American Taxpayer Relief Act of 2012, provides significant estate planning flexibility to married couples if sufficient planning hasn’t been done before the first spouse’s death. How does it work? If one spouse dies and part (or all) of his or her estate tax exemption is unused at death, the estate can elect to permit the surviving spouse to use the deceased spouse’s remaining estate tax exemption.
But making lifetime asset transfers and setting up trusts can provide benefits that exemption portability doesn’t offer. For example, portability doesn’t protect future growth on assets from estate tax like applying the exemption to a credit shelter trust does. Also, the portability provision doesn’t apply to the GST tax exemption, and some states don’t recognize exemption portability.
Have questions about the best estate planning strategies for your situation? Contact us — we’d be pleased to help.
April 15 has passed — now what?
With the 2012 tax filing season behind us, it’s time to start thinking seriously about 2013 tax planning — especially if you’re a higher-income taxpayer, because you might be subject to one or more significant tax increases this year:
- Taxpayers with FICA wages and self-employment income exceeding $200,000 for singles and $250,000 for joint filers face an additional 0.9% Medicare tax on the excess.
- Taxpayers with modified adjusted gross income exceeding $200,000 for singles and $250,000 for joint filers may face a new 3.8% Medicare tax on some or all of their net investment income.
- Taxpayers with taxable income in excess of $400,000 for singles and $450,000 for joint filers face the return of the 39.6% marginal income tax rate — and of the 20% long-term capital gains rate on long-term capital gains and qualified dividends.
Contact me at karen.botti@whalencpa.com to learn whether you’re likely to be hit with these tax hikes and what strategies you can implement to minimize the impact.
Karen Botti is the staff manager of tax services. She has more than 30 years of experience in the public accounting field with extensive experience in preparing and reviewing federal, state and local income tax returns for businesses and individuals as well as for non-profit entities. She serves as a resource to clients and staff in multiple tax areas. Her areas of expertise also include like-kind exchanges, fixed-asset reporting, tax software and S-Corporation issues. She also has experience in accounting and the preparation of financial statements and payroll taxes.