Time moves fast, especially this time of year. Soon we will be gathering for Thanksgiving feasts, and in what would seem like the following day, be celebrating the holidays and bringing on 2014. Although, the up and coming holiday season makes many busy, this can also be a wonderful time of year to plan for your tax returns due in 2014. Below are just a few considerations from a Denver tax attorney and estate planning attorney at The McGuire Law Firm.
Gifting and Charitable Giving:
If you are concerned about a taxable estate, this time of year can be a great time to gift to family members and take advantage of the annual gift tax exclusion while lowering your taxable estate. You can gift up to $13,000 to each individual without creating any gift tax issues and/or lowering your lifetime ability to gift property. If gifting certain property, you may still want to file a gift tax return, which allows the clock to begin ticking on the time available for the IRS to audit the return and question the fair market value of the gift. Furthermore, you may wish to look at your year-end tax position and consider donating to your favorite charity or creating a charitable trust. However, depending upon the outlook of 2014, maybe you should wait for such charitable contributions. The key is to make these considerations now and look at the tax implications before it is too late. Do not wait until 2014 and find yourself outside looking in on what you should have done in 2013.
Take advantage of the state income tax deduction and make a contribution to a child’s or grandchild’s 529 college savings plan. Not only does this 529 savings plan contribution have current tax benefits, it is a wonderful way to help provide financial assistance for the education of your loved ones.
Take Advantage of Certain Capital Losses Now:
Many investors have witnessed capital gains with the increases in the stock market. If you have loss property, now may be a good time to consider the sale, transfer or disposition of such loss property to offset other capital gains in 2013. Capital losses can offset capital gains and an additional $3,000 of ordinary income. Further, these capital losses can be carried forward to offset capital gains in following years, or $3,000 of ordinary income each year in the years to follow. Thus, ask yourself if it is time to cut bait on certain investments and take advantage of the loss now depending upon your other circumstances.
A Denver tax attorney and estate planning attorney at The McGuire Law Firm can assist you with year-end tax planning and tax planning at anytime depending upon a client’s circumstances, questions and issues.
Contact The McGuire Law Firm to schedule a free consultation with a tax attorney in Denver!