We are already over a month into the 2018 year! Here are five tax tips to get you on your way to a successful 2018:
1. Check Your Withholding
The IRS recently released new payroll withholding tables that take the new tax law into consideration. You can find the new withholding tables here: https://www.irs.gov/pub/irs-pdf/n1036.pdf. All employers should be using the new tables no later than February 15, 2018. Please double check your new paycheck amount, and make sure that the withholding amount is right for you, and your personal tax situation. The best way to double check your withholding is to have your CPA run a 2018 tax projection for you.
2. Increase Your 401(k) Contribution Amount
The beginning of the year is the perfect time to increase your retirement contribution amount. The maximum allowed yearly contribution has increased from $18,000 to $18,500 for 2018, a $500 increase from 2017. For taxpayers age 50 and over, the maximum contribution is now $24,500. If you don’t contribute the yearly maximum, try increasing your contribution by 1-2% of your salary.
3. Contribute to Retirement Accounts
If you haven’t yet made a Traditional IRA or Roth IRA contribution for the 2017 year, you have until April 17, 2018. For 2017 and 2018, the maximum IRA contribution is $5,500 ($6,500 if you are age 50 or older by the end of the year).
4. Check For Unspent FSA Funds
Do you have an FSA with any unspent funds from the 2017 year? The IRS allows employers to give FSA owners until March 15, 2018 to use their 2017 FSA funds to pay for eligible expenses. Check with your employer to see if they allow this grace period.
5. Start Gathering Your 2017 Tax Return Information
You can start gathering your tax information now and send it to your CPA, or begin entering the information into your tax software, including: charitable contributions, real estate and personal property tax payments, any unreimbursed business expenses, and any tax forms that have already come in the mail. By gathering information early, you will potentially complete your return sooner, which might mean receiving your refund earlier too.
Please contact us if you would like a tax projection completed to assist you in calculating your personal impact from the new tax bill.
Resources: IRS, TheTaxBook, TurboTax
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