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2023 Year-end tax planning tips

October 26, 2023


Year-end tax planning can be complicated, but it doesn’t have to be. Check out these 8 tips to consider before year-end.

1. Analyze your W-2 tax withholdings
If you receive a W-2, analyze your tax withholdings to make sure that you have withheld enough throughout the year. If you have not, you may need to withhold more from your final paychecks or a year-end bonus.

2. Determine fourth-quarter estimate payments
If you make estimated tax payments, consider your projected income for the year to determine if you need to make any fourth-quarter payments.

3. Organize your books
If you own your own business make sure that your books are organized and up to date. This will make for a more efficient tax preparation process.

4. Consider retirement plan contributions
This can be part of an effective tax strategy for both business owners and employees while also saving for retirement. If you are a business owner and do not have a retirement plan, there are new tax credits that help offset the costs of setting up and maintaining a retirement plan.

5. Fund health and college savings accounts
Funding health and college savings accounts before year-end may provide tax incentives while also putting money away for the future.

6. Consider purchasing new equipment and assets
For business owners, consider if any new equipment or assets are needed for the business. In many cases, it may be more beneficial to purchase these needed assets by the end of the year. This is especially true for 2023 as bonus depreciation continues to phase out in 2024.

7. Review your stock portfolio
It has been an interesting year in the stock market, but it may be beneficial to work with your financial advisor to take advantage of any tax losses in your portfolio.

8. Donate cash or other assets to a qualified charity
Donating appreciated assets including stock have added tax benefits rather than donating just cash. If you are required to take minimum amounts (RMDs) from your retirement accounts, qualified charitable distributions (QCDs) are another way to make tax-advantaged charitable gifts.

Year-end tax planning can be complicated, so it is important to have your entire financial team on the same page. If you have needs for tax planning, outsourced accounting or wealth management, please give us a call.