Year-End Tax Moves: Planning Ahead for a Stress-Free Tax Season with Jordan Sute Norton, CPA

On this episode of A Wiser Retirement™ podcast, Casey Smith is joined by guest Jordan Sute Norton, CPA, to talk about year-end tax moves and how to plan ahead for a stress-free tax season. They also talk about maximizing tax savings, including employer deferred accounts, charity bunching, and IRA and Roth IRA contributions.

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SUMMARY:

Take Advantage of the Tax Savings Opportunities Before the End of the Year

It’s important to take advantage of tax savings opportunities before the end of the year, especially if you are charitably inclined. There was an increase in the standard deduction for this year, which is a low-hanging fruit that everyone should go after. Consider maxing out your employer-deferred accounts which will further increase your tax savings.

Donating to charities is also a great way to benefit from tax savings. There are several strategies that can help you make the most of your charitable giving, such as “compressed gifting” or “bunching” charitable donations. This strategy consists of spreading donations across multiple years so they can itemize every other year. Donor-advisor funds are another option for those who may not currently have a charity in mind but do plan to give in the future. This is a great tool for maximizing tax deductions, especially in high-income years. There can also be tax benefits from putting money into Individual Retirement Accounts (IRAs) and 529 college savings plans. 529 plans are a great way to save money for future education needs.

Tax-Saving Options for the Upcoming Tax Season

There are various tax-saving options available for the upcoming tax season. For example, it might be a good idea to wait until tax time to make contributions to a Roth IRA. Contributing to a traditional IRA can cause confusion as it may not be eligible for a deduction, and brokerage houses may not be able to calculate the basis accurately. You could convert it to a Roth IRA instead, which will make the accounting clearer.

There are also great tax benefits of utilizing a Health Savings Account (HSA). Individuals can put aside $3,850 for a single account or $7,750 for a family per year. A HSA can grow and be used to pay for healthcare premiums in retirement. Income earned on a HSA is tax-free, making it a great option for those in higher tax brackets. Lastly, the Georgia based 529 college savings plan is a great way to save a few hundred dollars on your Georgia state tax return. 

Put Your Savings to Work

It’s important to consider putting savings to work and contributing to a high-yield savings account. Rather than paying extra money to the IRS, think about keeping it in a high-yield savings account to avoid penalty interest. 

Conversion Calculators

A CPA can run conversion calculators for tax planning purposes to forecast the future and determine whether converting to Roth is worth it or not. Conversions may not always be the best option, and you need to take into account the impact of taxes raised for stimulus and other reasons in the future. This is why it’s crucial to do your tax planning and financial checkups, particularly before filing tax returns. Also, make sure your financial advisors are involved in such conversations. This will ensure that you are aware of all the factors impacting your taxes.

Taxes and Estate Planning

Currently, individuals can gift up to $17,000 per year without having any filing requirements. If someone gifts you money, you have no tax obligation, the person who gifted that money does. There are changes coming at the end of 2025 that will effect the gifting limits. We recommend starting a gifting strategy to move money out of the estate if you have a large estate. The process of estate planning can be complex, but is necessary.

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TIMESTAMPS:

0:00 Intro

02:00 Take Advantage of the Tax Savings Opportunities Before the End of the Year

04:35 Tax-Saving Options for the Upcoming Tax Season

10:10 Put Your Savings to Work

20:15 Conversion Calculators

25:00 Taxes and Estate Planning

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