As we close out 2023 and look forward to the New Year, there may be a few financial moves to make still this year. I am sure that for many of you, much like myself, 2023 brought many changes, both personally and professionally. New jobs may have started for some, while others are getting closer to retirement, if not already there. You may have an increased income and need a tax advantaged retirement account. Or maybe you have received an inheritance and need to find ways to invest. Some may have started a new family, lost a loved one, whatever it may be, changes such as these may prompt you to review your finances and better position yourself for whatever 2024 may bring.

Have your income levels changed?  If so, you may want to check on the amount you have withheld. Do you need to withhold more and adjust withholdings at your employer via W-4? As financial situations change, so do the amounts withheld and you may need to adjust your withholdings before the new year starts.

Not only are donations a great way to give to charities that we hold closest to our hearts, but also a great way to possibly qualify for a tax deduction. There are many tax advantageous ways to give, either through deduction, giving appreciated stocks or through your required minimum distribution.  We’re happy to walk you through what maybe best for you and the charities you cherish.

Have you taken your Required Minimum Distribution (RMD)? Under the SECURE 2.0 Act, the age for RMDs was increased to 73 — offering employees an additional year to increase the savings in their tax-free retirement accounts and avoid a taxable distribution. Their first RMD must be taken by April 1 of the year they turn 73, and by December 31 each following year. So before the end of the year you must take the required minimum distribution out of your pretax retirement accounts such as IRA’s, 401k’s, even qualified annuities. There are penalties if this is not done by year’s end.*

Also, tax-loss harvesting is a way for tax advantages in your non-retirement investment accounts. This is the practice of taking capital losses (selling securities worth less than you originally paid for them) to offset capital gains. You can then move those funds to other investment to get the upside while getting the tax write off.**  We look to do this for our clients here at Capstone, if you have other outside investments, this should be consider. We are here to offer guidance and advice as this should be done with a financial professional.

So, as we look forward to many holiday celebrations and spending time with friends and family, you may want to consider some last-minute moves. Always feel free to call us to plan for this year, 2024 and years to come.

*Few exceptions for RMD if you’re still working, you may not need to take out of your current workplace plan, but need to double check

**IRS says new security can’t be “substantially identical.” There is a 30 day wash rule before buying the same security again