Tax planning should always work in conjunction with your estate planning, and the end of the year is a great time to look ahead to the future with your taxes.
It’s easy to feel as though we’re just at the beginning of the fourth quarter, but it’s actually an excellent opportunity to look ahead to 2017 and find out whether it makes sense to maximize your deductions for this year or even delay income into 2018.
You could reap the benefits of a permanent tax advantage if tax rates are lowered by the current administration. You may be able to make your New Year a more enjoyable one with a bigger refund or a reduced tax burden.
Pushing income into 2018 is ideal for those individuals who are freelancers who can delay billing or asking for your year-end bonus within 2018 if this is a standard practice in your company. Taking advantage of other tax breaks in 2017 such as higher education tax credits, child tax credits and student loan interest deductions are all beneficial for people who are looking ahead to their next tax year.
There are certain people who may not want to accelerate income into 2018. If you are subject to the alternative minimum tax this year, taxes and certain deductions are not deductible and therefore, should not be accelerated. Consulting with an experienced financial professional as well as your estate planning team in NJ is strongly recommended.