Hey, guys, in this video I want to talk about some year-end
tax planning strategies that you ought to be getting on right now.
Before we run out of year and they’ll no longer be available to you.
Okay, let's get started.
All right.
Now, the first one I want to talk about
are things that provide tax deductions for you.
So what types of items should we be looking at?
If I want to pick up tax deductions for 2022?
Well, what I would suggest you consider is setting up a self-directed IRA.
All right.
That'll get you a $6,000 tax deduction by making that contribution this year.
You can pick up $6,000 now.
If you're married, there's another $6,000.
You can you can pick up.
So that's a total of $12,000 you can transfer into a self-directed IRA.
Now, why did I say self-directed IRA?
Because with a self-directed IRA, you can then take those funds
and use them to buy real estate, but it doesn't stop there.
Another option you have is just set up a self-directed health savings account.
Now, with the self-directed sell health
savings account, you can contribute another 70 $300.
Now, of course, you have to meet the requirements to have a high
deductible plan in order for for you to be able to contribute to this.
But again, look for a self-directed health savings account.
So as you can see right now, I put a total of $19,300 into these accounts,
and I'm going to pick up a tax deduction for it in 2022.
Now, one of the things you may be asking yourself right now is
where the hell am I going to get that money?
I don't have $19,000 sitting around that I can contribute.
Okay, great.
Do you have a401k with a current employer?
Because if you do, you can go to that employer.
You can take a loan against your your 401.
K and now you got the money to start making contributions over here
and getting tax deductions.
Not to mention, wasn't the money you contributed to a401k deductible?
Yes, it was.
So you got double deductions with those funds.
So that's what you can be looking at this year to take great tax deductions.
The next year, take those funds and you can group them all together, maybe
set up a joint venture, limited
liability company, and go out and buy real estate with these assets.
So there's a lot that we can do.
We just got to get it into the right accounts.
What else should you consider?
Roth conversions, guys.
Roth Conversions.
Should you do it or should you avoid it now?
Roth Conversions
don't create tax deductions for us, but here's what we want to look at.
If your income has been low this year, you haven't been out there
doing as much as you normally would.
Maybe you wanted to take a year off.
Whatever it is, if you're in a very low tax bracket, you may want to consider
converting any traditional IRA you currently have into a Roth
while your income is low.
This is a great strategy to plan around your lower
income years or if you have a lot of some business losses.
I know some businesses have experienced tough times in 2022.
They talk about the economy possibly going into a downturn.
If you've got losses, suck up those losses against a conversion.
So if I want to if I have $80,000 in business losses, I would
then want to convert a Roth or traditional into a Roth of 80 grand.
So they will net out and I'll pay zero tax on that conversion.
Another thing, look at a donor
advised
fund. Okay.
So this is another strategy they like to use.
Let's assume a donor advice fund is a charitable contribution.
It's set up with a broker.
Now, what you'll do in this scenario is you're going to take money,
let's say, take $100,000, or you could take an appreciated asset
and you transfer it into this fund that you set up with the broker.
Now you're in control of the fund.
The key is here with this type of fund is you get a tax deduction for it
now, but you don't have to determine
which charity it's going to go to until a later date.
Now, why I like this strategy.
The donor advised fund strategy
is because it implies that in the future, let's say two years down the road,
when I made that contribution this year, you might put in $200,000.
I can later decide that instead of giving that money to a school or church
or some other nonprofit, I can create my own profit and transfer
the funds that I put set up with Charles Schwab in their donor advice want.
I can move them over my own nonprofit.
Once they're in my own nonprofit, I have control over them.
I can become an employee of that nonprofit.
I can draw a salary out of that.
So if my income's going to dip in the future years,
I can set up a nonprofit, move that money in.
I got a deduction my high tax years and I'm pulling out the income
in a low tax year.
Now, of course,
you have to have a charitable purpose, but that's not what this video is about.
We can talk about that later.
The other thing you can look at is donate assets, donate
assets like real
estate to a charitable remainder trust.
Great way to pick up a deduction.
This year without having to sell your property, you take an appreciated asset.
Could it be even B stock?
You transfer it into a CRT, you can leave it there,
start collecting rents on that real estate.
By moving that property in, you're going to get a tax deduction
and the money that rolls into
the trust is completely tax free until you decide to pull it out.
This is also a great strategy if you're looking to sell an appreciated
asset and transition into another asset class.
For example, if somebody told me
they think that the market's going to take off next year, that it's that it's
bottomed out and they have real estate, they want to transition into two stocks,
set up a CRT, put your property into CRT, you get a tax
deduction, sell the property, pay zero tax, go out and buy the stock.
When you're ready, start
pulling out the money, then it'll start distributing out to you.
But until that time happens, you don't pay any tax on that.
Great strategy of remainder trust.
Another thing you should be looking at loss harvesting.
All right.
This is really important.
Okay. We've seen a lot of ups and downs in the market this year.
And if you've gotten out of
some stock positions and you have losses sitting on your accounts,
find the gains, sell those stocks, generate those gains
so you can offset against the losses you've incurred this year.
You can always go back and buy those stocks again.
If you think they're going to continue to move.
But if you have losses this year
from from the market, be sure to take advantage them.
Or on the flip side, let's say you sold some stock back in March
and you've got a lot of gains and now you're looking at your portfolio
and it's got a lot of losses in it.
Sell those positions, get out of those losses to help offset
those gains that you generated early in the year.
So stock loss harvesting is a great strategy.
You can also use those losses
depend on the types against real estate gains as well.
Another thing I would look at is to delay asset
sales or delay asset sales
until 2023.
Now, what do I mean by that?
Let's say this year you've done really well
and you're in a higher income tax bracket
and you're thinking about selling an asset.
Look at ways to delay the sale until 2023 to delay the close.
So you take the income out of 2022 and you push it into 2023.
So you have an entire year now to plan for that income or ways to reduce it.
If not, you're going to push that income possibly up
into a higher tax bracket, which would never be good for you.
So delaying sales and there's other strategies
you might want to look at like options to do it
to ensure that you can push that off.
And then the other thing, last thing I talk about is cost segregation.
I've talked about this
many times in my videos, cost segregation with bonus depreciation.
If you're a real estate investor, do not miss this
this year, 100% bonus depreciation.
It is the last year that that's available to you.
Take any real estate you have, contact us.
We will put you in touch with some experts that do these
that set up the cost segues so you can harvest a tremendous amount
of losses and deduct 100% of it against your other forms of income.
So these are some of the strategies that I know there's many more like Section
179 asset expensing we could talk about.
But just taking advantage of some of these right here is going
to make sure that when it comes to preparing your taxes for 20, 20, 22,
your CPA will be looking at you going, you made some right choices.
All right.
You're going to get those with course, by working with Anderson,
you want to set up a strategy session, check out the link below.
We have a link there where you
can sit down and have a conversation with one of our strategists.
At no cost to you. Take care.