We see a LOT of financial mistakes each and every year. We have the knowledge to help you avoid these pitfalls. Often the issue is not known to us until tax time…when it is too late.
So to help you stay out of big problems this year, here is a list of tax and financial lessons to consider now:
Changing Jobs/Old 401k
Did you know our firm is licensed to handle your retirement investments? Our depth of service and expertise in retirement income planning is unmatched. An advisor who understands your investments, goals, and taxes…it just makes sense!
Whether you are 30 years old or age 70, do NOT cash in your retirement in a lump sum payout. The financial and tax consequences are enormous. A common example we see is cashing in retirement funds to purchase or payoff a home or car. This can cost clients up to 40% in lump-sum taxes when, currently, interest rates are below 4%. Please, please, please consult your GBE advisor first.
Missing Tax Document
“I forgot to give you a 1099-INT from the bank, but it was only $11. No big deal.”
No big deal can become a huge deal. When missing a document, many times the IRS will also automatically disallow items such as education credits, earned income credits, and adoption credits. The missing $11 will now cost you a $5,000 tax due notice from the government. Which means you’ll have to pay your accountant to help fight it. This takes time and energy. It is a big deal. Don’t forget to provide us with all of your tax documents the first time.
Failure to Communicate
If you bring an issue to our attention, we might be able to help with a solution. Before making a big decision it may be wise to ask us first. Items include:
- IRS and state tax letters: You may not owe what the letter says!
- Selling farmland or rental property: What are the tax consequences? Any estate or inheritance taxes to consider?
- Buying equipment: Let’s find the right time for a purchase.
- Saving for children’s college: How much? What kind of account makes the most sense?
- Gifting to charity: Finding a common sense approach to maximize tax benefits.
Let’s avoid the big mistakes this year!