As the end of the calendar year approaches, there are several steps individuals should take to take full advantage of their benefits and minimize their tax liability. If any of these situations apply to you, make sure you take whatever action is necessary before the days in 2019 run out.
Use Outstanding Flexible Spending Account Benefits
Tax law now allows individuals who have flexible spending accounts to carry over up to $500 in their account, but that is the maximum allowed amount. Anything beyond $500 that’s in an account and not spent by year’s end is forfeited.
If you have an FSA and fully used its benefits, make sure you spend anything over $500 by December 31. This is a good time to schedule doctors appointments, including optometrist and dental appointments, or to stock up on approved medical supplies. Should you have a large medical bill, you might even be able to split payment across the new year.
If you have an FSA and fully used its benefits, make sure you spend anything over $500 by December 31. This is a good time to schedule doctors appointments, including optometrist and dental appointments, or to stock up on approved medical supplies. Should you have a large medical bill, you might even be able to split payment across the new year.
Maximize Savings Account Contribution
To take full advantage of the benefits offered by tax-advantaged retirement and college savings accounts, you should reach the maximum contribution to any account that you have before year’s end. The maximums vary depending on what kind of account you have and (with retirement accounts) your age, but reaching the contribution limit will always yield the greatest tax savings.
If you don’t have a retirement or college savings account set up, you can still create one and contribute to it by December 31.
Make Charitable Donations
The holiday season is usually when people are most generous to charities, and year-end donations could help reduce your tax burden if you itemize on your return.Every donation made to a 501(c)3 non-profit is deductible — just get a receipt to show your contribution.
For help preparing your finances before the end
of the year, contact Brock CPA.
of the year, contact Brock CPA.
Regards,
The Team at Brock CPA
