2015 Year End Planning Checklist

2015 Year End

Planning Checklist

Thanksgiving is here and Christmas is not far down the road. Here are a few tax specific items we recommend you revisit as 2015 draws near its conclusion.

Capital gains – If you have a legacy stock you have owned for a long time that has done well recently, now may be an excellent time to take that gain.  

Charitable contributions – Charitable contributions are a great way to reduce your tax liability and continue the mission of worthy organizations through your gifts.   

• You have until December 31 to make charitable contributions and get the tax deduction for 2015. However, if you plan on making gifts with shares of common stock or a mutual fund it should be processed by December 4 to allow for enough time for the transfer process. Real estate is another great asset to use in gifting to charities. This will take time and careful planning. 

Retirement plan contributions

You have until December 31 to make additional contributions to your employer’s 401k or 403b retirement plan. 

• 401(k) & 403(b) -This may also depend how your retirement plan is structured. The Salary deferral limits for a 401(k) for 2015 is $18,000, plus an extra $6,000 if you are 50 or older.  SIMPLE 401(k) contribution limit is $12,500 or $15,500 if you are 50 or older. Please consult your tax advisor for details on the SEP IRA contribution limits. 

Roth IRA and Traditional IRA contributions

IRA contributions can be made until April 15, 2015. The limit for 2015 is $5,500, with an additional catch-up contribution of $1,000 for people age 50 or older. 

Business planning

It is important that you continue to consult with your accountant or tax advisor to address the many tax law changes that will likely occur over the next several years. These may have a tremendous impact on your business and planning for the future. 

Education Planning

Section 529 College Education Savings Plan – “Frontloading” is an exception to the Gift Tax limitation. Within one year of opening the account, you may contribute for the first five years all at once, up to $70,000 or ($140,000 for couples), as long as you don’t contribute any more for the first five years following the account opening. This is great for those with lump sums, such as inheritances, and it allows more money in the account sooner, giving it more time for potential growth.  Specific states may have state income tax benefits when using their state sponsored plan. 

The deadline for making contributions is April 15, 2016.

Estate Planning

The year end is a great time to review your estate plan. This would include who you have listed as your Personal Representative, trustees of any trust, guardian for your minor children, agents for your durable power of attorney and healthcare powers of attorney. Also, review beneficiaries of your will, trust, life insurance and retirement account beneficiaries. 

In closing, I would recommend that you consult with your tax advisor for specifics to your situation.