All too often, taxpayers wait until after the close of the tax year to worry about their taxes and miss opportunities that could reduce their tax liability or financially assist them. Mid-year is the perfect time for tax planning. The following events can affect your tax return; some may require steps to mitigate their impact and avoid unpleasant surprises after it is too late to address them. Here are some events that can trigger tax opportunities and/or consequences. Did you (or are you going to):
Get married, divorced, or become widowed?
Change jobs, or has your spouse started working?
Have a substantial increase or decrease in income?
Have a substantial gain from the sale of stocks or bonds?
Buy or sell a rental?
Start, acquire, or sell a business?
Buy or sell a home?
Retire this year?
Reach age 72 this year?
Refinance your home or take out a second home mortgage this year?
Receive a substantial inheritance this year?
Take advantage of tax-beneficial retirement savings?
Make any significant equipment purchases for your business?
Purchase a new business vehicle and dispose of the old one?
Adequately document your cash and non-cash charitable contributions?
Keep up with your self-employed estimated tax payments?
Make any unplanned withdrawals from an IRA or pension plan?
Add a solar electric system to your home or purchase an electric vehicle?
Hire veterans or other individuals in your business that may qualify for the work opportunity tax credit?
Defer employer payroll taxes in 2020?
Incur expenses adopting a child?
Start receiving Social Security benefits?
Exercise an employee stock option?
Start using a part of your home for business this year?
Exchange real properties used in your trade or business or held for investment?
Start a retirement plan in your self-employment business?
Make gifts of over $15,000 to anyone individual this year?
Receive advance child tax credit payments?
Of course, these are not the only events that have tax consequences. If you anticipate or have already encountered any of the above events or conditions, it may be appropriate to consult with this office—preferably before the event—and definitely before the end of the year.