2019 – BFG Q4 Webinar
Tax Law Changes at a Glance For Individuals: • lower income tax rates • a larger standard deduction • severely limited itemized deductions • no personal exemptions • an increased child tax credit, and a watered-down alternative minimum tax (AMT)
Tax Law Changes at a Glance (cont.) For Businesses: • corporate tax rate reduced to a flat 21% • elimination of corporate AMT • limits on business interest deductions • very generous expensing and depreciation rules
Tax Law Changes at a Glance (cont.) For Non-corporate taxpayers: • Qualified business income (QBI) from pass-through entities may be entitled to a special 20% deduction
2019 Tax Brackets, Rates, and Deductions
2019 Individual Tax Brackets & Rates
2019 Standard Deduction
LT Capital Gain Brackets and Rates
Year-End Tax Planning Moves
Postpone Income Until 2020 • May enable you to claim higher deductions, credits or tax breaks for 2019 • Also desirable for anyone who anticipates being in a lower tax bracket next year • Avoid additional taxes – 3.8% Net Investment Income (NII) tax – 0.9% additional Medicare tax
Accelerate Deductions Into 2019 • May enable you to claim higher deductions • Lump certain deductions such as charitable contributions and medical expenses in order to itemize instead of taking the standard deduction
Itemized Deductions Reminder • No more than $10,000 of state and local taxes (including real estate taxes) may be deducted; • Miscellaneous itemized deductions (e.g., tax preparation fees and unreimbursed employee expenses) are not deductible; • Interest paid on home mortgage debt is deductible to the extent of debt up to $750,000
Additional Tax Planning Moves • Increase your withholding of state and local taxes or pay estimated tax payments before year-end to pull the deduction of those taxes into 2019 • Convert all or part of your eligible retirement account (e.g., 401(k), traditional IRA, or other non-Roth accounts) to a Roth IRA before EOY • Taking versus delaying required minimum distributions (RMDs) from your IRA or 401(k)
Additional Tax Planning Moves • Harvest capital losses on investments to offset capital gains • Fund HSA accounts before end of the year • Make contributions to 529 Plans
Year-End Charitable Giving
Charitable Contribution Strategies • Load up on contributions • Give to a donor-advised fund (DAF) • Make a Qualified Charitable Distribution (QCD) • Create a charitable trust • Gift appreciated stock
Year-End Charitable Gifting Reminders • Ensure the timely completion of gifts • Confirm that charities cash QCD checks by the deadline • Drop off non-cash donations • Coordinate cash or credit card donations
2019 Year-End Financial Planning Checklist Recommendation Target Date Retirement Planning/Employee Benefits December 31 st Maximize Retirement Plan Contributions Fund Non-Deductible IRAs & Convert to Roth April 15 th , 2020 December 31 st Rebalance 401(k) December 31 st Take Required Minimum Distributions December 31 st Make Deferred Comp Elections Gifting/Education Planning December 31 st Complete Annual Exclusion Gifts ($15,000/$30,000) December 31 st Fund 529 Plans April 15 th , 2020 Open and Fund Roth IRAs for Children Estate Planning Execute Crummey Notices December 31 st Review Estate Plan & Beneficiary Designations Ongoing
2019 Year-End Financial Planning Checklist Recommendation Target Date Income Tax Planning December 31 st Adjust Tax Withholding Consider Roth IRA Conversion December 31 st December 31 st Make Charitable Gifts/Consider Bundling Itemized Deductions December 31 st Consider Making a QCD from your IRA Other Review Group Benefit Elections & Make Updates for Coming Year Ongoing December 15 th Enroll in new Health Insurance Plan Through Healthcare.gov December 7 th Complete Medicare Open Enrollment Request Annual Credit Report Ongoing Consider Updating Passwords & Security Questions Ongoing
2019 Year-End Financial Planning Checklist Key Milestones Age 50 You can make catch-up contributions to IRAs and some qualified retirement plans Age 55 You can take distributions from your 401(k) plan without penalty if retired Age 59 1/2 You can take distributions from IRAs without penalty Age 62-70 Apply for Social Security benefits Age 65 Apply for Medicare Age 70 1/2 You must begin taking Required Minimum Distributions from IRAs
2019 Year-End Financial Planning Checklist Important Dates 12/31/2019 Last day to complete gifts & make tax moves for the 2019 tax year 1/15/2020 4 th Quarter 2019 estimated tax payment due 3/15/2020 Deadline for Partnerships/S Corp. to file tax return or file extension 4/15/2020 Deadline to file 2019 income tax return or file extension 6/30/2020 Last day to file the Free Application for Federal Student Aid (FAFSA) 10/15/2020 Deadline to file 2019 income tax return if an extension was filed
Disclosure Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk, and there can be no assurance that the future performance of any specific investment, investment strategy, or product (including the investments and/or investment strategies recommended or undertaken by Bouchey Financial Group, Ltd.), or any non-investment related content, made reference to directly or indirectly in this newsletter will be profitable, equal any corresponding indicated historical performance level(s), be suitable for your portfolio or individual situation, or prove successful. Due to various factors, including changing market conditions and/or applicable laws, the content may no longer be reflective of current opinions or positions. Moreover, you should not assume that any discussion or information contained in this newsletter serves as the receipt of, or as a substitute for, personalized investment advice from Bouchey Financial Group, Ltd.. Please remember to contact Bouchey Financial Group, Ltd., in writing , if there are any changes in your personal/financial situation or investment objectives for the purpose of reviewing/evaluating/revising our previous recommendations and/or services. Bouchey Financial Group, Ltd. is neither a law firm nor a certified public accounting firm and no portion of the webinar content should be construed as legal or accounting advice. A copy of the Bouchey Financial Group, Ltd.’s current written disclosure statement discussing our advisory services and fees is available for review upon request.
Q & A Follow-up Questions please contact us at: Office Phone: 518-720-3333 Email Contact: planningpaysoff@Bouchey.com
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