End of year tax planning

End of year tax planning

Share

April 2018 may seem like a long way off, but in tax terms, it's already here. In order to minimize your 2017 tax bill you need to start planning now. Here are some things you can do between now and the end of the year to help make your April 17 (Tax Day 2018) a little happier.

Give to charity

December is the season of giving, and by giving to a favorite cause you maximize your deductions for 2017. Be sure to think beyond cash: both your generosity and tax benefits can be boosted by donating appreciated stock or property. Remember though, you'll need a receipt to take a deduction for any charitable contribution.

Take your required minimum distribution

Fail to do so, you'll face a stiff penalty from the IRS; a 50% excise tax on the ammount you should have withdrawn based on your age, life expectancy, and the amount in the account at the begining of the year. Annual withdraws must be made by Dec. 31 to avoid the penalty.

Roth IRAs do not have required minimum distributions

Watch out for the alternative minimum tax

The alternative minimum tax (AMT) is designed to set a limit on the tax benefits and loopholes that the wealthy can employ; its purpose to help ensure that everyone pays a minimum amount of taxes. However, it wasn't - until 2013 - automatically adjusted for inflation so over time it came to affect more and more middle-class taxpayers. Be sure to discuss your risk of being subjected to the AMT with your tax advisor before the end of the year.

You can find helpful tax planning strategies for any time of the year in our Tax Center.

Need more insight? Let us be your guide.

Our national network of experienced financial advisors can help you create a personalized plan to help you identify financial goals and get you where you want to go in life.

Find an Advisor

Related Insights

Hanging file folders

Standard deductions after tax day

Are you getting ready for April 15, 2019? That’s when the first taxes owed under the Tax Cuts and Jobs Act of 2017 are due. Here’s what you need to know about the standard and itemized deductions you’ll be able to take come April 2019.

Read More
White House

Tax Cuts and Jobs Act: How it affects you

In December 2017 the Tax Cuts and Jobs Act was signed into law. The bill’s primary function is a massive corporate tax cut, but individual taxpayers are also impacted by an across-the-board tax cut.

Read More
 Tax Deadline

Due date approaches for 2017 federal income tax returns

Tax season is here. Here’s what you need to know about filing on time, extensions, refunds and, regrettably, any potential amounts due.

Read More

Associated Tags: Taxes

This information is provided for informational and educational purposes only. Waddell & Reed believes the information has been obtained from sources considered to be reliable, but does not guarantee the accuracy of the information provided. 

Market Data powered by Wikinvest. Data is provided as-is, delayed, and subject to Terms