As the end of the year approaches, I still field calls and emails from various clients asking what ways can we reduce our tax liability by the end of the year.
Consider opening up a Traditional IRA bank account. A deductible IRA contribution can lower your taxable income by the amount you invest in. The maximum contribution amounts if you are under the age of 50 is $6,000 and $7,000 if you are age 50 and older. You can even make these contributions in 2020 and have it applied for 2019!
- Make an energy-saving improvement to your main home. The IRS will give you a 30% credit on all qualified solar energy property reported on form 5696. You must have these improvements completed before the year ends.
- If you have a rental or business income you may qualify for the new 20% qualified business income deduction known as QBID. The net income from the business may qualify for an additional 20% credit!
- Consider dumping the stocks that you know are losers for a capital loss to offset your capital gain income and potentially utilities the up to $3,000 capital loss in excess of capital gain.
- Call our office to see if it makes sense to make a distribution from your retirement account in the end of 2019 or in 2020, we can run scenarios for you that will show you what tax bracket you may be in for those years and help you make the right deduction on saving money during tax time.
If you need any more help, please do not hesitate to call us at 626-355-1242 or send an email firstname.lastname@example.org