By Kortney Christensen, CFP®, Executive Vice President, Director of Sales and MarketingPrint This Post
Year-end is a great time to review your tax situation for opportunities to pay less in taxes or pay taxes at a lower rate. Review your portfolio and other financial matters along with your projected income and tax rates with your tax advisor to see whether you should take or defer gains and deductions this year.
For example, you may be able to take a gain on an investment this year, or postpone it until January. If you think your tax rate will be the same or lower next year, it may make sense to postpone the gain until 2017. Similarly, if you are considering making a charitable donation and you expect your income (and tax rate) to be higher next year, consider delaying the donation until January to offset your higher tax rate. If you pay state estimated taxes, you could make your last quarterly payment in January rather than December to move the deduction into 2017. If you can control when to take a gain or deduction, choosing the appropriate time to take such actions can help you control your potential tax liability year over year.
Please remember, Benjamin F. Edwards & Co. does not provide tax advice, so it is important to consult with your tax professional for guidance tailored to your specific situation.