Year-end tax and financial planning letter for individuals

Here are a few more tax and financial planning items to discuss with us:

  • Life changes –– Let us know about any major changes in your life such as marriages or divorces, births or deaths in the family, job or employment changes, starting a business and significant expenditures (real estate purchases, college tuition payments, etc.).
  • Capital gains/losses –– Consider tax benefits related to using capital losses to offset realized gains –– and move any gains to the lowest tax brackets, if possible. Also, consider selling portfolio investments that are down before the end of the year. Net capital losses can offset up to $3,000 of the current year’s ordinary income. The unused excess net capital loss can be carried forward to use in subsequent years.
  • Estate and gift tax planning –– Let’s make sure you’re appropriately planning for estate and gift tax purposes. There is an annual exclusion for gifts ($16,000 per donee in 2022, $32,000 for married couples) to help save on potential future estate taxes. Let’s review lifetime gift and generation skipping transfer (GST) opportunities to use additional exclusions and exemption amounts.
  • State and local taxes –– More people are working from home (i.e., teleworking). Such remote working arrangements could potentially have tax implications that should be considered. Let us help you with your state income, sales and use tax questions.
  • Education planning –– Let’s consider Sec. 529 plans to help save for education; there can be income tax benefits to do so, and we can help you with any questions.
  • Roth IRA conversions –– Let’s discuss and weigh the benefits of converting your traditional IRA to a Roth IRA to lock in lower tax rates on some of your pre-tax retirement accounts.
  • Estimated tax payments –– Let’s review withholding and estimated tax payments and assess any liquidity needs.

Year-end planning equals fewer surprises

Whether it’s working toward a tax-optimized retirement or getting answers to your tax and financial planning questions, we’re here for you. Please contact our office at 281-471-5747 to talk about your year-end review or email your tax preparer with your questions. As always, planning ahead can help you minimize your tax bill and position you for greater success.


Bruce A. Hammack, CPA