10 Year-end tax guide tips

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10 year end tax-planning tips
Presentation1
Year-end tax guide tips

Accelerate deductions and
defer income.
Consider deferring bonuses, consulting
income or self-employment income. On
the deduction side, you may be able to
accelerate state and local income
taxes, interest payments and real
estate taxes.

Bunch itemized deductions.
Many expenses can be deducted only
if they exceed a certain percentage of
your adjusted gross income (AGI).
Bunching itemized deductible
expenses into one year can help you
exceed these AGI floors.

Make up a tax shortfall with
increased withholding.
If you’re in danger of an underpayment
penalty, try to make up the shortfall by
increasing withholding on your salary
or bonuses.

Leverage retirement
account tax savings.
It’s not too late to increase
contributions to a retirement account.
Contributions reduce taxable income
at the time that you make them, and
you don’t pay taxes until you take the
money out at retirement.

Reconsider a Roth IRA
rollover.
It has become very popular in recent
years to convert a traditional IRA into a
Roth IRA. This type of rollover allows
you to pay tax on the conversion in
exchange for no taxes in the future (if
withdrawals are made properly).

Get your charitable house
in order.
A cash contribution must be
documented to be deductible.
If you claim a charitable deduction of
more than $500 in donated property,
you must attach Form 8283.
For cars, attach the charity's
acknowledgment with a description
of the car.

Give directly from an IRA.
If you are 70.5 years old or older, using
your IRA distributions for charitable
giving could save you more than taking
a charitable deduction on a normal gift.
That’s because these IRA distributions
for charitable giving won’t be included
in income at all, lowering your AGI.

Zero out AMT.
The top alternative minimum tax (AMT)
rate is only 28%; so you can “zero out”
the AMT by accelerating income into the
AMT year until the tax you calculate for
regular tax and the AMT are the same.

Don’t squander your gift
tax exclusion.
You can give up to $14,000 to as many
people as you wish in 2016, free of gift
or estate tax. You get a new annual gift
tax exclusion every year, so don’t let it
go to waste.

Leverage historically low
interest rates.
An appreciating market and historically
low rates create the perfect
atmosphere for estate planning.
The past several years presented a
historically favorable time, and the low
rates won’t last forever.

For additional tax planning tips for
compensation and benefits, privately
held businesses and private wealth
planning, visit Grant Thornton’s
Year-End Tax Guides 2016.
For Additional Tips

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interested in the topics presented herein, we encourage you to contact us or an independent
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10 Year-end tax guide tips

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10 Year-end tax guide tips