A Few Tax Considerations to Keep in Mind as the End of Year Draws Near
By Kevin Witriol, Partner
Based on your particular circumstances, you may be missing out on tax savings if you do not revisit your plan before we ring in the new year. Speak with your tax advisor about particular opportunities that might be available to you. Below are a couple of examples:
Using IRA Distributions for Charitable Deductions - It's Not Too Late Yet!
If you are considering using the funds in your individual retirement account (IRA) to make a charitable contribution, it's a good idea to follow up on your plans sooner rather than later. Under the American Taxpayer Relief Act of 2012, individuals who are age 70� or older can make a qualified charitable distribution from an IRA directly to a charity. You can exclude donations up to $100,000 of an otherwise taxable distribution from your gross income and count them toward the current tax year's required minimum IRA distributions.
The rules only apply to distributions made in 2013, so you need to act now. If this option doesn't suit your needs, there are many other planning opportunities involving charitable giving. Reach out to your tax advisor to find out which ones apply to you.
Will You be Hiring Soon? Tax Credit for Certain Hires Only Available through Dec. 31
The Work Opportunity Tax Credit offers employers a tax credit for hiring members of certain groups, including many veterans and those who have received vocational rehabilitation. The maximum credit can be as high as $9,600, depending on the employee, but it only applies to hires who begin work before January 1, 2014.
Tax credits are a dollar-for-dollar reduction in your tax bill, so they are well worth taking advantage of. Your company may be eligible for many credits or deductions that can lower your tax outlay. Contact your tax advisor to discuss the best ways to minimize what you're paying to be sure you are taking advantage of the opportunities available to you.
DOMA Decision's Impact on Financial Planning for Same-Sex Couples
If you and your partner are a married same-sex couple, then the U.S. Supreme Court's recent decision to strike down the Defense of Marriage Act could have a substantial effect on many aspects of your financial life. You may want to consider, for example, filing an amended income tax return if you now qualify for deductions or credits available to married couples under federal law. Since same-sex couples are now eligible for the estate tax exemption available to surviving spouses, it may also be time to review your estate planning.
Those are just a few of the changes affecting qualifying same-sex couples. If you have questions about the decision's impact and what it means to your financial situation, be sure to contact us today.
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