Things to Consider

Now is the best opportunity to make use of tax strategies to take advantage of tax-deferred growth opportunities, charitable-giving opportunities, as well as tax-advantaged investments among others. During this tax planning process, you will also want to make sure you maximize deductions and credits ahead of the busy tax season. As you consider your year-end options, make sure to sit down with your attorney or other advisors to review your investments to ensure they still align with your goals, the economic landscape, and the current tax law. This conversation can help you identify where adjustments may be necessary for the future.

What You Need

Know that the “traditional” year-end planning we’ve recommended for years still applies to your 2018 taxes. Make sure you are harvesting losses to offset your gains, are contributing the appropriate amount to your Individual Retirement Account (IRA) and/or Health Savings (HSA) accounts, and have taken the necessary required minimum distribution from your IRA (if this applies to you). Other things to consider is fully funding employer-sponsored retirement plan contributions such as 401(k, 403(b) or 457 plans before the end of the year. The same rings true for college savings plans, such as 529 plans. You may even want to consider converting a traditional IRA to a Roth IRA.

Beyond these important points, also make sure to start gathering the necessary documentation you may need for any deductions that you are claiming. These may include copies of statements or receipts regarding your property taxes, medical expenses, dental expenses, child care expenses, education expenses, moving expenses, and heating/cooling expenses. For business owners, the new 199A deduction for business income will have additional paperwork requirements. It’s best to work with your bookkeeper and accountant at gathering those records now, rather than waiting until the hectic tax season.

Seek Professional Advice

With changes to the U.S. tax code now in effect, it is especially important to make the right decisions when it comes to your year-end financial moves. A skilled tax attorney or financial advisor can help explain your options under the law and provide you with guidance so that you can make the best decisions for you, your family, and your future. If you have any questions, feel free to contact us.

Most business owners have their estate planning prepared because they are worried about what will happen to their business after they are dead.  However, proper estate planning has the added benefit of allowing you to make plans for what will happen if you are incapacitated or needing to be away from your business for an extended period of time.

As the owner, you are responsible for the day-to-day operations of your business. This is a full-time responsibility. But what will happen if you can’t be there all the time?  You don’t necessarily have to be in a coma to be unable to participate in your business. You could be on an extended vacation or have a medical diagnosis that requires you to take several months away for treatment or recovery.  During this time, your business needs to continue on so that you and your employees can continue to take home money.

It is important to think ahead about who will be in charge of the day-to-day operations because a ship without a captain can be dangerous.  Not only does this individual need to understand the business, he or she needs to have the respect of your employees, and be confident in making tough decisions in your absence.  Without this planning, everyone could jump to the conclusion that he or she is in charge, or alternatively, no one will step up, resulting in chaos either way.

If you have family members working in your business it is also important to explain to them what will happen in your absence and who will be in charge so that someone does not assume they are in charge just because they are family. Importantly, remember that just because your family is involved with your business does not mean that he or she is the best choice to succeed you.

We can help you develop a plan to keep your business running while you are away. From choosing the right individual to putting processes in place for your incapacity, we are here to help. Call us today 918-928-9573.