2018 Tax Planning Tips

It is hard to believe that November is underway and the holidays are right around the corner. Before we know it, 2019 (and tax season) will be here. However, before we let the holidays come and go, it is important to speak with your trusted accountant to determine what you can do before the end of the year.

This is important whether you own a business or not. Here are some questions that should be answered by your trusted tax professional.

• Should I donate to charity?
• Should I max out my 401k?
• Should I buy that piece of equipment or open a retirement plan through my business?
• How will the new tax law affect me?

Keep in mind that it is much easier (and could save you a lot of $$) to plan ahead than to fix afterwards.

When it comes to planning ahead for your personal taxes and finances, there are many things to consider.

Many taxpayer’s won’t benefit from property tax deductions: Had we spoken around the holidays in 2017, we would have been discussing prepaying some of your property taxes. However, with the standard deduction doubling in 2018, taxpayers may find it difficult to benefit from property tax deductions.

Consider doubling up charitable deductions every other year: Along the same lines, now that the standard deduction has nearly doubled, does it make sense (for tax purposes) to donate to charity? I have been discussing the idea of grouping charitable donations with many of my clients. This way, taxpayers will be able to claim more of a deduction than if they paid the same amount every year.

Think twice before maxing out that 401k: Does it make sense to max out your 401k contributions (hint, this is more than just about taxes, it depends on your debt levels)?  Although you may think businesses are more complex, there are plenty of issues that we can discuss for your personal financial life.

The new tax law will have a huge impact on small business owners: If you are a business owner, there are also a great deal of questions that we can answer regarding year-end (and overall) tax planning. If you own and rent out your office building, should the same LLC own the property? Should I make that huge purchase for my business now or should I wait until 2019? What type (if any) of retirement plan should I open for my business? It all depends on your specific situation! You can always ask your friends/colleagues, but keep in mind their answer is usually based on their situation (not yours)!

You may be asking – “I don’t need an accountant, my taxes are simple.”  I have heard that statement many times, and most of the time I found errors in the return or ways the client could have saved enough money to pay my fee and have a lot left over.

Your trusted tax professional is there for you throughout the year.  The relationship should be more than just assisting with your filing during tax time.

I look forward to answering any of your questions (even if I won’t be doing your taxes).  I can be reached via email (akabatchnick@gmail.com) or cell phone (973-879-9111).  I look forward to answering any of your tax , accounting, and other financial questions and working with you in the future!