Things to Do to Lower Next Year’s Taxes: Effective Year-End Tax Planning Tips

If you’re looking for things to do to lower next year’s taxes, Starner Tax Group offers practical year-end money moves focusing on maximizing deductions and tax credits. These tax planning tips help reduce your 2024 tax bill by carefully managing expenses and taking full advantage of available tax-saving strategies.
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Lower Your 2024 Tax Bill: Starner Tax Group’s Year-End Tax Planning Tips

Introduction – Year-End Tax Planning for a Lower 2024 Tax Bill

As the year ends, you should think about your tax plan. This kind of planning helps you save money by lowering your tax bill. You want to act now with smart, easy tax-saving steps.

Good timing and careful work matter a lot. They let you get the deductions and credits you qualify for. The aim is clear: pay less when you file taxes next year.

Reduce Your Taxable Income: Smart Strategies for 2024

Cutting down your taxable income is key as 2024 comes up. Try these simple ideas:

Maximize Deductions: Look for all deductions like medical bills, mortgage interest, or donations.
Use Tax Credits: Check if you can claim credits for school or green home fixes.
Boost Retirement Contributions: Put more money into IRAs or 401(k)s to lower your income now.
Think About Income Timing: See if you can push bonuses or paychecks past December 31.

Doing these things early means paying less taxes later. Good income tax planning today cuts your taxable income tomorrow — so your total bill goes down!

Maximize Deductions and Credits

If you want to lower your tax bill next year, it helps to plan ahead. Using smart tax planning tips to maximize deductions and claim tax credits can really cut down what you owe. These moves reduce taxable income and keep more cash in your pocket.

Maximize Deductions to Lower Your 2024 Tax Bill

Itemizing vs. Standard Deduction

You have two main ways to save on taxes: the standard deduction or itemizing. The standard deduction is a set amount by the IRS. Itemizing means you list your deductible expenses like mortgage interest, property taxes, and charitable donations.

Here’s how to pick the best option:

Add up all your deductible expenses such as property taxes and donations.
See if that total is more than the standard deduction for your filing status.
If yes, itemizing lowers your taxable income better.

Try to keep good records of deductible expenses all year long so you can choose wisely when tax time comes.

Strategies to Increase Deductible Expenses

You can boost your deductible expenses in a few ways:

Business owners should keep track of work-related costs like supplies, travel, or equipment.
Medical bills that go over 7.5% of your adjusted gross income might be partly deductible.
Paying some bills early, like property taxes or mortgage interest, can increase deductions for the year.

Do these things before December 31st to make sure you get the biggest deductions possible.

Claiming Tax Credits: Boosting Your Refund

Tax credits reduce your tax bill dollar-for-dollar. They are often more powerful than deductions because they cut what you owe directly.

Child Tax Credit

If you have kids who qualify, this credit can lower your federal taxes a lot. Seniors may also get special credits based on their age that help lower taxes. Keep in mind that rules change each year depending on income and other factors.

Earned Income Tax Credit

The EITC helps workers with low to moderate incomes by giving a refundable credit based on earnings. To claim it:

Report your earned income correctly.
Check if you meet the qualification rules carefully.

Many people miss out just because they don’t understand if they qualify. The EITC can cut taxes owed and even give you a refund beyond what was withheld.

Other Credits

You might qualify for other credits too, depending on your situation:

Education credits for tuition costs
Energy credits for home improvements
Adoption credits

Look at what’s available each year because laws often change these benefits.

Maximizing deductions and tax credits means planning through the whole year. If you live in Rogers AR and want to lower your taxes next year, talk with Starner Tax Group – Rogers pros who know how to help with smart year-end tax planning based on what fits you best.

Ready to start saving? Contact Starner Tax Group today for advice that helps raise refunds and cuts future tax bills!

Retirement Contributions: Lower Your Tax Bill and Save for the Future

Making smart retirement contributions can help lower next year’s taxes while saving money for later. When you put money into accounts like 401(k)s and IRAs, you can get deductions and even some tax credits. Planning carefully means you reduce your taxable income, pay less tax, and grow your savings.

Here’s why it matters:

Contributions lower your taxable income.
You can maximize deductions and tax credits.
It helps minimize your overall tax bill.
Saving early means more money later.
Being timely with contributions boosts benefits.

401(k) and IRA Contributions

Putting money in a 401(k) or IRA lets you delay paying taxes until retirement. In 2024, you can add up to $23,000 to a 401(k) if you’re under 50. If you’re 50 or older, you get to add an extra $7,500 as catch-up contributions. For IRAs, the limit is $6,500 a year, plus $1,000 if you’re over 50.

These contributions help lower your current taxable income. Plus, the money grows tax-deferred until you take it out. Don’t wait—making deposits before year-end is key to getting full benefits during income tax planning.

Roth IRA Conversions

A Roth IRA conversion moves money from a traditional IRA into a Roth account by paying taxes now. This way, future withdrawals are tax-free. It’s a good move if you expect to pay higher taxes later or want to skip required minimum distributions (RMDs).

Keep in mind:

Conversions raise your taxable income for the year.
But they lock in today’s tax rates for future gains.
Timing the conversion carefully helps balance costs and savings.

Roth conversions are a handy part of tax-saving strategies when used right.

Tax-Advantaged Savings Strategies: 529 Plans and More

There are other ways to invest that help reduce taxes while reaching different financial goals.

Some options include:

Flexible Spending Accounts (FSAs): Use pre-tax dollars for medical expenses each year.
Health Savings Accounts (HSAs): Offered with high-deductible health plans; triple tax benefits apply:
- Contributions are deductible
- Earnings grow tax-free
- Withdrawals for qualified expenses aren’t taxed
529 College Savings Plans: Earnings grow federal tax-free when used for education costs. Some states also give extra deductions or credits based on these contributions.

Other smart moves are:

Prepaying property taxes before December 31st if laws allow it—this speeds up deductions into this year.
Making charitable donations that come with solid charitable donation tax benefits when itemized correctly.

Using different tax-advantaged accounts helps protect against rising taxes while supporting personal goals with smart planning and timely actions.

Investment Strategies for Tax Efficiency

If you want to pay less tax next year, you need smart investment moves. Using tax-saving strategies can help you get bigger deductions and lower your taxable income. Tax-efficient investing keeps more money in your pocket by cutting down the tax bite on your earnings.

Here’s what you can do:

Choose investments that create less tax
Plan sales to reduce your tax hit
Use losses to cancel out gains

This way, your money stays put and grows better.

Tax-Loss Harvesting: Minimizing Capital Gains Taxes

Tax-loss harvesting helps you pay less capital gains tax. Here’s how it works: you sell some investments that lost value to cancel out gains from others you sold at a profit. This offsets gains and lowers your taxable income.

For example, if you make $5,000 on some stocks but lose $3,000 on others, you only pay taxes on $2,000 net gain. If losses are bigger than gains, you can carry those losses into next years.

You can even rebalance your portfolio while doing this. That means adjusting your investments without getting stuck with a big tax bill.

Strategic Tax Planning: Capital Gains and Losses

Knowing capital gains tax rates is very helpful. Profits from things held longer than a year are taxed less than ones sold quickly.

Remember these points:

Long-term gains get taxed between 0% and 20%, based on how much you earn
Short-term gains get taxed like regular income, which is usually higher
Holding investments longer cuts down taxes a lot
Selling near year-end lets you use any losses to balance out gains

By following these rules, you lower the taxes on your profits and keep more money.

Using these investment tips now can lower next year’s taxes. They help maximize deductions and shrink taxable income by making smart choices. If you live in Rogers AR and want advice that fits you better, Starner Tax Group can help with detailed tax-saving plans.

Want to make your investments more tax friendly? Contact Starner Tax Group today to see how they can assist!

Year-End Tax Planning Checklist: Reduce How Much You Owe

Year-end tax planning helps you lower next year’s taxes and cut your overall tax bill. If you act on time and plan carefully, you can reduce your taxable income and save money. Follow this checklist to guide your tax optimization while sticking to IRS regulations and meeting tax deadlines.

1. Review Your Income and Expenses

Take a good look at your income for the year. Track expenses that might be deductible, like medical bills, charity gifts, or business costs. This will help you see if itemized deductions will beat the standard deduction.

2. Maximize Retirement Contributions

Put as much as you can into retirement accounts like a 401(k) or IRA. These contributions reduce your taxable income right away. For instance, traditional IRA contributions might be partly or fully deductible depending on your situation (see IRS Publication 590-A). Try to do this before December 31.

3. Accelerate Deductions When Possible

Pay some bills early—like property taxes or mortgage interest—before the year ends. That way, you get federal tax deductions this year instead of next. But watch timing so it fits IRS rules.

4. Defer Income If Beneficial

If it works for you, wait to receive bonuses or other income until after January 1 of the new tax year. Deferring income lowers this year’s taxable earnings and might drop you into a lower tax bracket.

5. Use Tax Credits Wisely

Tax credits cut what you owe dollar for dollar. Deductions only lower taxable income by a percentage. Examples include education credits or energy-efficient home improvement credits (check IRS Form 8863).

6. Evaluate Itemized vs Standard Deduction

Add up all itemized deductions and compare them with the standard deduction ($13,850 single; $27,700 married filing jointly in 2024). Pick whichever saves more when you file next season.

By using this checklist early each December, you can take timely steps to lower next year’s taxes through smart planning that fits your money situation.

For help with year-end strategies that follow IRS regulations and save you more in the Rogers AR area, contact Starner Tax Group — plan ahead smartly to keep more of what you earn!

Contact Starner Tax Group – Rogers, AR for Expert Tax Advice

When you want to lower next year’s taxes, getting expert help really matters. Starner Tax Group in Rogers, AR offers personal tax advisor consultations. They help you handle tricky tax rules and find ways to save more. Whether you need a tax professional or a financial advisor, their team gives advice that fits your situation.

Year-End Tax Planning Services in Rogers, AR

Starner Tax Group focuses on year-end tax preparation services that help lower your taxable income and cut down your tax bill. Their income tax planning uses smart moves like making strategic retirement contributions and taking full advantage of deductions and credits.

You can plan ahead by working with them early. This helps catch chances you might miss before the new tax year starts. They find ways to save money by spotting deductions you forgot or timing expenses right.

Here’s what they do:

Prepare your taxes carefully
Plan your income taxes with smart strategies
Suggest strategic contributions
Help you plan ahead to save money
Work to minimize your tax liability

If you want to make good choices that affect your money in a positive way, talking with a trusted tax consultant is key. Call today for expert advice on cutting next year’s taxes with proven methods made for you.

FAQs on Things to Do to Lower Next Year’s Taxes

What are tax withholding adjustments and how can they lower my taxes?

Tax withholding adjustments let you control how much tax your employer withholds from your paycheck. Adjusting it accurately helps avoid owing taxes or overpaying and boosts your cash flow.

How do estimated tax payments affect my tax bill?

Making accurate estimated tax payments during the year helps avoid tax penalties. It keeps you current with IRS rules and reduces unexpected tax burdens at filing time.

What should I know about avoiding tax penalties?

To avoid tax penalties, pay taxes on time, file returns promptly, and make required estimated payments. Keep track of IRS deadlines and maintain accurate records.

How can I prevent a tax audit?

Maintain thorough expense tracking and proper documentation of deductions. Avoid errors on tax forms, follow federal tax rules, and consult a tax professional for audit protection.

What are required minimum distributions (RMDs) and their impact on taxes?

RMDs are the minimum amounts you must withdraw yearly from certain retirement accounts after age 73. Missing RMDs causes penalties and increases taxable income.

Can charitable donations help cut my tax bill?

Yes, charitable donations offer solid charitable donations tax benefits when properly documented. They can increase your federal tax deductions if you itemize.

How do capital gains tax strategies reduce my taxes?

Capital gains strategies like holding investments longer or using losses to offset gains lower your capital gains tax. This reduces your taxable earnings from investments.

Are there state tax breaks that can lower next year’s taxes?

Many states offer deductions or credits such as for education, energy upgrades, or retirement contributions. Check local tax codes for state-specific breaks.

Additional Tax-Saving Moves to Cut Your Tax Bill

Tax-Exemptions: Claim exemptions based on dependents or special circumstances to lower taxable income thresholds.
Tax-Deferred Accounts: Use accounts like 401(k)s and HSAs to defer taxes until withdrawal, cutting current year’s taxable income.
Tax-Free Growth: Invest through accounts that grow without taxation, such as Roth IRAs or 529 college savings plans.
Tax Bracket Management: Shift income timing to stay in lower federal tax brackets for reduced rates next year.
Tax Filing Tips: Organize your documents early and choose filing status wisely to optimize returns.
Expense Tracking: Maintain detailed records of deductible expenses for easier itemized deductions or business write-offs.
Charitable Giving Strategies: Bundle multiple years of donations into one year to exceed standard deduction thresholds and save more.
Estate Tax Planning: Plan gifts and inheritances with a professional to minimize estate taxes efficiently.
Retirement Tax Planning: Coordinate contributions with withdrawals to balance income streams and minimize overall taxes.
Audit Protection: Use a qualified tax consultant to review returns before filing to prevent IRS audits.
Disaster-Related Tax Relief: Explore special provisions for disaster victims that may reduce taxable income or extend deadlines.
Small Business Tax Planning: Use self-employed tax strategies like home office deductions and retirement plans designed for business owners.
Tax Preparation Services: Employ professional services or trusted software that understand the latest IRS rules and legislation updates including SECURE Act changes.

These proactive, smart moves help reduce how much you owe while boosting savings safely within IRS guidelines.

For personalized advice on these topics tailored to your situation in Rogers AR, contact Starner Tax Group — expert financial advisors ready to help optimize returns next year!