Final-minute tax write-offs for the year

Final-minute tax write-offs for the year

You should reevaluate your tax preparation strategies if you only do it around the filing date. The year’s close is actually just as crucial. You may be able to shave a few dollars off your annual tax bill by following a few last-minute, year-end suggestions. Find out how to navigate the 2022 tax law changes with the help of certified tax services in Pembroke Pines, FL specialist.¬†

Final tax advice

To help you make sense of your tax situation, here are nine last-minute pointers:

  1. Funds in FSAs expire after a certain period of time if they are not used.

Funds contributed to a flexible spending account (FSA) are not subject to taxation (FSA). You have until the deadline to use the tax-free funds for approved medical expenses.

This money should be used for out-of-pocket medical costs, such as a new pair of spectacles, medicine, medical equipment, or co-payments. In November and December, you can use any remaining funds from your FSA to pay for necessary medical care or prescriptions.

  1. Budget for any necessary changes to the timing of your payments.

If you expect your adjusted gross income in 2022 to be close to the standard deduction of $12,950 for single filers or $25,900 for joint filers, you may want to consider bunching your itemized deductions every other year. For various reasons, you might put off making some payments or charitable contributions until the new year. Putting off this years outlays until next year’s taxes may increase your itemization deductions in the following year.

Remember that the best tax planning is done over several years, so putting more money toward taxes this year might not be the best move.

  1. Find out if a tax benefit phaseout will affect your tax return by estimating your income.

Many tax breaks become less significant as your income rises. The benefit may be reduced or phased out altogether beyond a specific point. If you are close to the phase-out range of a tax benefit but still want to claim it, reducing your adjusted gross income (AGI) may help. This can be done in a variety of ways, one of which is to maximize your contributions to a tax-advantaged retirement account (such as a 401(k), 403(b), or deductible IRA).