Thanksgiving is roughly one week away. Many of you are probably making travel plans, or planning on what foods to prepare; others might be looking forward to the traditional football broadcast, or the day off from work. However you plan on celebrating the upcoming holiday, let us also not forget how this is the season for strategic financial planning. There are many things to be thankful for within each of our lives, but here are three tax benefits towards financial strength that deserve much thanks.
While giving to the less fortunate can be done throughout the year, Thanksgiving seems to be one of the opportune times when you can donate to a charitable organization. Not only are there people who will be thankful for your generous gift, you can be thankful for the valuable tax benefit from giving to charity.
First, you should make sure that the charitable organization you’re donating to is recognized by the IRS. You can find out by searching the organization’s name through the IRS website. Second, your contributions must be itemized in order to properly deduct them on your tax return. You can only deduct up to 50% of your adjusted gross income (AGI) with charitable contributions; however, you could extend your limit with the help of a tax professional.
For more information, check out the following blog:
Year-End Gifts for Charity
For those of you who are in the stock game, tax harvesting is selling a poor performing stock, which results in a net loss offsetting your tax liability in capital gains. With tax harvesting, you can decrease your overall tax liability.
Experts state that Thanksgiving is the best time to utilize this strategy since the IRS has a rule regarding selling stock or securities at a loss within 30 days before or after purchasing the same stock or securities. Check with your local tax professional for details.
If you’re fortunate enough to have a company-sponsored 401(K) plan
, along with an employer who matches contributions, this month is a great time to review your annual 401(K) contributions. You want to make sure you’re receiving the maximum amount of your company’s match; you’ll also want to contribute as much as you lawfully can.
To take full advantage of these tax benefits, you have to make your contributions before December 31. If you need further assistance, you should consult your local tax professional.
But Wait! With everything there is to be thankful for, we’re thankful for the tax extensions for allowing more time to get all our tax information together. E-file for an extension quickly and easily with ExpressExtension. Being prepared for tax season is everything so create and enter your organization details right now for FREE, and then complete and transmit your extension when necessary.
Our die-hard team of e-filing professionals in Rock Hill, South Carolina are ready to lend you a helping hand. Get in touch with us Monday through Friday from 9 a.m. to 6 p.m. at (803) 514-5155, or email us 24/7 at firstname.lastname@example.org