Article Highlights:Not Needing to File a 2023 Return?Are Your Children Attending College?Did You Sell Your Home This Year?Do You Have an Employer Health Flexible Spending Account?Did You Become Eligible to Make Health Savings Account (HSA) Contributions This Year?Is Your Income Unusually Low This Year?Must You Take a Required Minimum Distribution (RMD)?Do You Have Stocks That Have Declined in Value?Do You Have Stocks That Have Appreciated in Value and Your Income Is Low This Year?Have You Considered Prepaying State Income and Property Taxes?Are You Planning Your Charitable Deductions?Do You Have Outstanding Medical or Dental Bills?Have You Forgotten the Annual Gift Tax Exclusion?Do You Think You May Have Under-Withheld Taxes This Year?Did You Suffer a Disaster Loss This Year?Divorced or Separated This Year?Do You Qualify for Energy or Environmental Tax Credits?o Credit for Energy Efficient Home Modificationso Solar Credito Clean Vehicle Credito Previously Owned Clean Vehicle CreditAre You a Working Shareholder in an S Corporation?Are You Planning Business Purchases Soon?Are You Self-Employed?Do You Plan to Pay Your Employees a Bonus?Business Awareness Issueso 2024 E-File Mandateo Corporate Transparency Act Year-end is rapidly approaching, as are the holidays. So, before you become distracted with the seasonal celebrations, it may be in your best interest to consider year-end tax moves that can benefit you for both 2022 2023 and 2023 2024. Here are last-minute tax issues you might consider: INDIVIDUAL PLANNING OPPORTUNITESNot Needing to File a 2023 Return? - If your income and tax situation is such that you do not need to file for2023, don’t overlook the opportunity to bring in some additional income, to the extent it will be tax-free. For instance, if you have appreciated stock that you can sell without incurring any tax, consider selling it, or perhaps take a tax-free IRA distribution if you are 59½ or older or if younger and qualify for an exception to the “early withdrawal” penalty.Also, just because you are not required to file a tax return does not mean you shouldn’t. By not filing you may miss out on some substantial refundable tax credits.Are Your Children Attending College? If you qualify for either the American Opportunity or Lifetime Learning education credits, check to see how much you will have paid in qualified tuition and related expenses in 2023. If it is not the maximum allowed for computing the credits, you can prepay 2024 tuition if it is for an academic period beginning in the first three months of 2024. That will allow you to increase the credit for 2023. This is especially effective for students just starting college who only have tuition expenses for part of the year.Did You Sell Your Home This Year? If so, and if you meet the ownership and occupancy tests, the gain from selling your main home will not be taxed, up to $250,000 ($500,000 if you file a joint return with your spouse who also meets the occupancy test). But if you don’t meet the requirements of both owning and using your home for 2 years in the 5 years counting back from the sale date, you may still qualify for a partial home sale gain exclusion. For example, you may qualify for a reduced exclusion if you sold your home to relocate this year because of a change in employment or due to health. We can determine the amounts of excluded income and taxable gain, and project how your taxes will be impacted.Do You Have an Employer Health Flexible Spending Account? If so, and if you contributed too little to cover expenses this year, you may wish to increase the amount you set aside for next year. The maximum contribution for 2023 is $3,050. The amount you haven’t used in 2023 that may be carried to 2024 is $610 and must be used in the first 2½ months of 2024.Did You Become Eligible to Make Health Savings Account (HSA) Contributions This Year? If you become eligible to make health savings account (HSA) contributions late this year, you can make a full year’s worth of deductible HSA contributions even if you were not eligible to make HSA contributions for the entire year. This opportunity applies even if you first become eligible in December. In brief, if you qualify for an HSA, contributions to the account are deductible (within IRS-prescribed limits), earnings on the account are tax-deferred, and distributions are tax-free if made for qualifying medical expenses.Is Your Income Unusually Low This Year? If your income is unusually low this year, you may wish to consider converting your traditional IRA into a Roth IRA. The lower income likely results in a lower tax rate, which provides you an opportunity to convert to a Roth IRA at a lower tax amount. Also, if you have stocks in your retirement account that have had a significant decline in value, it may be a good time to convert to a Roth.Are You Required to Take a Required Minimum Distribution (RMD)? Once U.S. taxpayers reach the age of 73, they are required to take what is known as a “required minimum distribution” from their qualified retirement plan or IRA every year. If this is the first year that this rule applies to you and you haven’t withdrawn the required amount yet, there’s no need to panic – you don’t have to do so until sometime during the first quarter of next year. Of course, if you wait until 2024 to take your 2023 distribution, you’re going to end up having to take two distributions in one year – one for 2023 and one for 2024.For those who have been required to take an RMD before 2023, you only have until December 31st to take the required distribution for 2023 if you want to avoid penalties.Do You Have Stocks That Have Declined in Value? With the stock market’s ups and downs, you should review your stock portfolio and consider selling losers to offset capital gains that would otherwise be subject to the 15% or 20% long-term capital gains tax rate. Capital losses can also offset up to $3,000 ($1,500 in the case of a married taxpayer filing a separate return) of ordinary income if capital losses exceed capital gains by at least that amount. Recognizing capital losses to offset capital gains can also reduce the amount of income subject to the net investment income surtax. Be aware of the wash sale rules that don’t allow you to deduct a loss if you repurchase those loser stocks within 30 days before or after the sale date.Do You Have Stocks That Have Appreciated in Value and Your Income Is Low This Year? There is a zero long-term capital gains rate for taxpayers whose taxable income is below the 15% capital gains tax threshold. This may allow you to sell some appreciated securities that aren’t in an IRA or retirement account that you have owned for more than a year and pay no or very little tax on the gain. The 2023 15% capital gains tax bracket starts at a taxable income of $89,251 for married joint filers, $59,751 for those filing as head of household, and $44,626 for all other filers.Have You Considered Prepaying State Income and Property Taxes? You probably know that if you are not subject to the alternative minimum tax and you itemize your deductions, you are eligible to deduct both your property taxes and state income (or sales) tax up to a maximum of $10,000. But did you know that in some cases, and of course if you haven’t exceeded the cap, you can increase the amount that you deduct on your 2023 return by prepaying some of the taxes by December 31, 2023? You can ask your employer to boost the amount of your state withholding by a reasonable amount; or, if you are self-employed, pay your 4th-quarter state estimated tax installment in December (otherwise due in January) and increase your deduction. The same is true for your real estate taxes: if you pay your first 2024 installment in 2023, you can take it as part of your 2023 deduction. But be mindful of the so-called SALT limit – the maximum deductible amount of state and local taxes of all types is $10,000. So, don’t electively prepay state taxes if you are at or above the $10,000 cap.Are You Planning Your Charitable Deductions? Many people who itemize take advantage of the ability to take a deduction for their donations to their favorite charities or house of worship. Did you know that you can choose to pay all or part of your 2024 planned giving in 2023 in order to increase the amount you deduct in 2023? Though this may not be appealing to those who itemize every year, if you alternate between taking the standard deduction one year and itemizing the next, this can give you a big boost.Charitable contributions are deductible in the year in which you make them. If you charge a donation to a credit card before the end of the year, it will count for 2023. This is true even if you don’t pay the credit card bill until 2024. In addition, a check will count for 2023 if you mail it in 2023. For last-minute mailings, it may be appropriate to obtain proof of mailing from the USPS. And don’t forget to get an acknowledgment letter or document from each qualified organization that clearly states the donated amount and whether the charity gave you goods or services (other than certain token items and membership benefits) as a result of the contribution.Did You Know You Can Make Charitable Deductions from Your IRA Account? Those who are age 70½ or older are allowed to transfer funds (up to $100,000 annually) from their IRA to qualified charities without the transferred funds being taxable, provided the transfer is made directly by the IRA trustee to a qualified charitable organization. If you are required to make an IRA distribution (i.e., you are age 73 or older), you may have the distribution sent directly to a qualified charity, and this amount will count toward your RMD for the year.Although you won’t get a tax deduction for the transferred amount, this qualified charitable distribution (QCD) will be excluded from your income, with the result that you may get the added benefit of cutting the amount of your Social Security benefits that are taxed. Also, since your adjusted gross income will be lower, tax credits and certain deductions that you claim with phase-outs or limitations based on AGI could also be favorably impacted.If you plan to make a QCD, be sure to let your IRA trustee or custodian know well in advance of December 31 so that they have time to complete the transfer to the charity. If you have contributed to your traditional IRA since turning 70½, the amount of the QCD that isn’t taxable may be limited, so it is a good idea to check with this office to see how your tax would be impacted.