Tax Planning Help

Tax Planning Help

| February 11, 2022
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2021 Tax Return Reminders
Consider the following before filing your 2021 Tax Return and let us know if you need help accessing your 1099s or other details relating to your investment accounts.
Education Expense Deduction – As of 2021, the tuition and fee deduction is no longer available. However, the income limits have increased for the lifetime learning credit.
Charitable Contributions – Even if you don’t itemize your deductions, you may once again be able to deduct cash contributions of up to $600, if married filing jointly (or $300 if filing single).
Virtual Currency – All taxpayers will be required to answer a question as to whether or not they received, sold, exchanged or otherwise disposed of any virtual currency during 2021.
Child Tax Credit Advance Payments – Reconcile the advance payments you received, with the total Child Tax Credit that you are able to claim for 2021. If you received less than the amount you are eligible for, you can claim a credit for the remainder. If you were eligible for the credit and did not get monthly advance payments, you can still claim the credit when filing your 2021 tax return. Watch for Letter 6419 from the IRS showing the total advance payments received, and keep this with your tax records for the year.
Economic Impact Stimulus Checks – If you did not receive or qualify for a third stimulus check, you may still be eligible for a Recovery Rebate Credit based on your 2021 tax information. Watch for Letter 6475 showing the total third stimulus check received, and keep this with your tax records for the year.
Paycheck Protection (PPP) Loans – If you received a PPP loan, you won’t need to report the forgiveness as income. However, you will need to report certain details about your PPP Loan.

How we help with your Tax Planning
You may already know that we regularly review and rebalance your portfolio to keep it aligned with your stated goals and objectives. Did you know that we also regularly assess your entire financial situation and consider tax strategies that may be right for you during a given tax year?
• Monitor Required Minimum Distributions (RMDs)
• Qualified Charitable Distribution (QCD) record keeping
• Roth IRA Conversion consideration
• Rebalance investments to avoid excessive fund capital gain distributions when appropriate
• Harvest tax losses as they become available
• Social Security benefit taxation consideration
• Communicate with your tax preparation professionals as needed

What else can you do?
• Send us a copy of your latest tax return for review
• Let us know if you have any prior year loss carry-forwards
• Bundle Deductions to possibly exceed the higher standard deduction
• Consider Qualified Charitable Donations (QCDs) directly from IRAs to help meet RMDs
• Gift appreciated assets to a charity or Donor Advised Fund
• Maximize your annual retirement plan contributions.
• Consider a Health Savings Accounts (HSA) if you have a high-deductible insurance plan
• Maximize contributions to 529 plans that qualify for state tax credits

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