Summer is flying by. Do you feel that way?
It’s an exciting season with cookouts, vacations and extracurricular activities (my thoughts and sympathies for Colorado Springs parents with multiple kids playing multiple sports among 100 other things). Before you know it and July is almost over. How does it all go by so fast?
But if you can find some time amidst the craziness, please consider these four tax moves for lowering your 2019 tax bill.
If some (or all) of these are unfamiliar to you, please reach out – we can tackle them together.These aren’t difficult items but do take some intentionality. Let’s meet before summer’s end and chip away at your tax bill.
(or shoot me an email through the link at the top of the page)
Now, on with some advice . . .
Four Great Summer Tax Moves For Folks in Colorado Springs
“We keep moving forward, opening new doors, and doing new things, because we’re curious and curiosity keeps leading us down new paths.” -Walt Disney
Let’s dive right in, since it really is hot out there…
Bunches & Bunches
If you’re not familiar with a bunching strategy, it helps you meet itemized deduction thresholds. Essentially, you bring in as many allowable expenses as you can into a taxable year.
If you itemize, we’ll want to pay careful attention to your medical expenses. In 2019, medical expenses must exceed 10 percent of AGI – a change brought about by the Tax Cuts and Jobs Act (TCJA).
Making an additional mortgage payment or two before year’s end can also be claimed as an itemized deduction. And, of course, your donations to IRS-approved charities are deductible.
Side: Speaking of donations, this is a great time to take some clutter (clothes, keyboards, etc.) out of those closets and donate to those Colorado Springs charities!
This is one where it would be especially helpful to have someone like me walk you through it. Why? Because the TCJA strikes again.
The new law limits tax-deduction value of home equity loans. Therefore, interest is only claimed on Schedule A where the money borrowed is used to improve the home. If that’s confusing to you, I get it. Give me a call and we can go over it in-depth.
Re-Focus on Retirement Funds
Did you know, in 2019, inflation makes it so you’re able to add more to your workplace 401(k) and other retirement funds like a Roth IRA?
On that note, you might want to convert your IRA to a Roth since ordinary tax rates are lower than they have been in many years. But let’s chat before you do that . . . As of the TCJA, you cannot undo Roth conversions.
I know . . . we’ve talked about this before. But it really is so important.
Whether you received a bigger refund this year or had to pay up, it’s important to make sure your withholding is accurate. Feel free to use this IRS Withholding Calculator or just reach out to me and we can sit down together and figure it out.
For many, summer means all those good things I mentioned earlier. And they are good.
But I can’t help but get excited thinking about a jump start on next year’s taxes. Especially if it means helping you lower your tax bill.
Wilklow & Associates, CPA PC