As the year draws to a close, it's time to consider tax strategies to simplify your filing process. The article outlines several actionable steps you can take now, such as maximizing contributions to retirement accounts, strategically selling investments, and utilizing capital losses to offset gains and income.
As the end of the year approaches, everyone's minds are on the same things: family, togetherness, taxes, peace on Earth and resolutions for the new year.No one wants to think about taxes at the end of the year, but remember: Even though you don't have to file until April, your taxes are calculated based on what you did between Jan. 1 and Dec. 31 of this year. So if you want toThere are plenty of steps you can take now to make life a little easier come tax time.
But maybe you had some losers, too. If you sell an investment at a loss, the IRS allows you to use that loss to offset gains and income in a strategy known as Then, if your losses still exceed your gains, you can use up to $3,000 of your net loss to negate ordinary taxable income. Any additional negative money you have left can be rolled over into the following tax year.
"The key message is you shouldn't just be tax-loss harvesting to tax-loss harvest," he says."Unless I have a need for that loss, either this year or in the very near future, you're really not gaining any immediate benefit, and in fact, I'm kind of limiting my options going forward."If you're already planning to make some major purchases around this time of year, don't overlook tax credits associated with certain items, such as a new car or home renovation.
Taxes Retirement Accounts Capital Gains Tax Loss Harvesting End Of Year
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