Tax Tip Tuesday: A Look Back at Our Tax Tips

By Jeffrey R. Wolfe, Senior Vice President and Manager, Wealth Planning Strategies

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With tax season ending yesterday that doesn’t mean you need to forget about your tax situation. It’s time to look forward to the rest of this tax year to plan for your filing next year. Consider reviewing your strategies to make sure your tax situation is in its best shape. Given the continuing market volatility, you may want to consult with your tax professional regarding any other modifications to your tax planning you may need to consider such as:

  • Consider whether to take certain gains or losses in this taxable year. Choosing the appropriate time to take such actions can help control your potential tax liabilities.
  • Look at fully funding employer-sponsored plans and/or tax-deductible IRAs. Maximizing these contributions may lower your tax bracket.
  • Review Roth retirement planning options, especially in this volatile market. Converting existing pre-tax assets to a Roth IRA, funding a Roth IRA, or making Roth salary deferral contributions through your 401(k), 403(b), or 457(b) plan now may provide more after-tax cash flow during retirement. Recall, though, once you make a Roth conversion it cannot be undone.
  • Consider tax-exempt investments and accounts like tax-exempt municipal bonds or life insurance.
  • Think about the location of your assets. Perhaps mutual fund investments are more pragmatic in a tax-deferred account than a taxable account for your situation.

Taxes are one of the two guaranteed things in life, so you must continue to deal with them. Stay diligent and review your situation with your tax advisor and your financial advisor throughout the year to put together a plan that is right for you.

 

Benjamin F. Edwards does not provide legal or tax advice, therefore it is also important to consult with your legal and tax professionals for additional guidance tailored to your specific situation.