Maximize Your 2024 Tax Refund: Expert Mid-Year Tips You Need to Know

Intro [Music] welcome back everyone Doug Bon here and last time we spent some time talking about things that we should be thinking about from a tax perspective this time of year in other words did you get what you wanted to on your return last year did you owe more than you thought or did you get less of a refund than you thought if you did what have you done to change it and I want to continue talking about that today some of the things we talked about last last time where did you get a new job rw4 is calculated correctly did you get a second job sometimes that can cause some uh some issues did you inherit some money and did you take some money out of your 401K retirement plan well today we're going to continue that theme and take on a few more topics so one of the things I want to talk about is if you did owe last year and maybe your income is self-employed or you're on pension income uh have Investments different things rentals maybe you're doing quarterly estimates have you done your estimates first of all and if you did did you change the amount now if you're one of our clients we will usually change your estimates based on the tax return but did that happen did you up the amounts or more importantly has some things happened in your life that you're prepared didn't know when he calculated your estimates and they need to be adjusted and it's not always adjusted it up it could be down and you could be sending too much money in so I want to think about that on your quarterly estimates some of that you can review last week's video but I'm going to talk about some other things that could cause us to want to change those estimates so Investments the first thing we're going to talk about on that line is your investments in 2024 a lot of you have had a really good year your Investments are up they should be anyway cuz the Market's done pretty good but it depends on what your in invested in but a lot of your Investments are up and depending on how you're invested uh you may have a tax liability coming up that you didn't know about especially if you're in mutual funds it could be kicking out cap gains or if you sold stocks and you don't have enough losses to offset it so one of the things you want to be looking at right now is how are my investments doing and what do we think it's going to look like by the end of the year you can talk with your financial advisor about that but those are some things you could look at Tax smart investments and am I invested in a tax smart manner maybe I shouldn't even be getting dividends if I'm not currently using them and I should be in more of a a growth model instead of an income model something to think about but if we're generating a bunch of taxable income then we're not using that income maybe we need to adjust our strategy so that's one of the things that happens quite often when I'm doing the tax return they had a good year in their investment account and they didn't think about it from a tax perspective and all of a sudden now we owe an extra 6,000 10,000 whatever it is that we weren't anticipating so make sure to take a look at your investment account next I want Maintain accurate records to talk to you people who are selfemployed this one gets people quite often and it's pretty easy to check but we need to make sure that we're maintaining accurate records it's so important to have good records we do this for a lot of our clients we do the accounting for them so that we have good records so we can help them stay on top of this but are your books up to date it's so critical for so many reasons not only for just uh doing the taxes but also for managing your business is my cost of good sold getting out of control is my labor getting out of control all these different things you need to make sure your records are up to date cuz if they're not we can't even really have this conversation and you're flying blind from a tax perspective because as we get into the third and fourth quarter we want to start thinking about things like should I be buying a truck should I be buying a trailer should I be whatever it is that affects your business is this the right year to expand we don't know that if we don't have good numbers so it's very critical that you have good numbers now now that you have those good Yeartoyear comparison numbers what do we do with them from a tax perspective one of my favorite reports that we have within our our financials that we give out is a year-to date and a 2-year comparison okay so if last year through the end of June I've made $50,000 and this year I've made $70,000 to the end of June maybe I need to talk to my accountant about adjusting my quarterly estimates or maybe we need to start considering maybe this is the right year to upgrade some of our equipment we need those good Good Records but the year-to DAT comparison year over-year will give you a good indication of what your tax liability is going to be next year it could also let us know if maybe we should uh up our retirement so year to- dat comparison I can't stress that enough it's one of my favorite reports is this year through June versus last year through June take a look at Expenses that havent been paid that that'll quickly give you an idea of how you're doing but not over stressing about all the details just look at it now once you've looked at it if you're at $50,000 but you know you've got a bunch of expenses that just haven't been paid yet you know that don't panic but just use it as a gauge to give you an idea and if the numbers are up or if they're down down can be really important too maybe we're paying oursel too much salary for the income we have this year or maybe we should be paying oursel more salary based on the income that's going on this year especially if you're an escorp these it's going to be very important things to think about so I'm just trying to give you things to think about here and if any of those mean mean something to you maybe it's time to talk to your accountant and take a look at that okay back to individuals one of the things in strategies that's really been big the last few years is the idea of a Roth conversion and what are we doing there we're converting money from our individual retirement account into a wroth why would we want to do that well Taxes I don't know about you and I'm not talking politics here but the way our country is spending you have to think that at some point at least I do taxes probably have to go up and if they go up I don't want to have to pay a bunch of tax on my retirement account but it's bigger than that there's so much going on there when you get into retirement we want to have money in multiple buckets so that we can control our tax situation we can do that more when you're retired than in any other time in our life and there's a lot of reasons to do it one our tax brackets if we have money that's not taxable we can lower our tax but also there's other things that are going to creep up on you once you get to Medicare called Irma I MA a and if you make over a certain amount of money your medicare premiums go up so it's another reason we want to manage our income and retirement and so one of the ways that we can do that is by converting our Ira traditional IRA into a wroth but we got to be careful about that and so and we'll talk about that more in another video but just simple if you're in a 12% bracket this year and you've got maybe another 10 15 $2,000 till you get to the next bracket maybe this is a really good year to convert some money and maximize that bracket and pay a really low tax rate now so that when we retire later it'll be taxfree and we can manage our tax brackets and it might even make sense if you're in a 22 24% bracket you get much above that and the Roth conversion starts getting hard to pull off but I just want you to be thinking about these things is this a good year for me to start doing WTH conversions and what is my strategy for when I retire to manage my income this is a good time to do it while rates are still low the end of 25 at least for now the tax cuts and jobs Act expires and tax rates are at this point scheduled to go back up will that happen I don't know but it looks like right now that it might so maybe 24 and 25 are really good years maybe the last two years to take advantage of some of these really favorable tax brackets now moving on Retirement Plan along this same theme if your business so this is back to you business owners if your business is having a good year year this is a very very important time for you to look into setting up a retirement plan if you don't have one right now or maybe it's a good time to look into changing your retirement plan if you haven't already contributed to it this year the deadline the time is running out for when we can do that we'll probably talk more about that in another video too but I want to bring it to your mind now in this video because it's relevant we can't wait till December and have every option available to us as far as what we can do on our retirement and we definitely can't wait till we file the tax return next year and have all the options there are some that we can do all the way up until April 15 but not all of them and so maybe this is a year we should do a solo 401k or maybe we should set up a regular 401K for our entire business maybe we should be doing a set maybe we should be doing a simple like I said not the time for that fully in this video but some of those options we start to run out of time for here pretty soon so we need to take advantage of it so if our income is up and we do want to go ahead and try to manage our taxes this year it's time to look at it now so once again go back to that year today comparison is my income up do I think it's going to stay up do I have some additional money that I would like to shelter from taxes if you do we need to start talking about it now and you can call call us we can we can discuss whether it makes sense for you right now from a tax perspective but it's something you need to take care of right now to make sure it gets done on time so there you have it there's some Conclusion quick tips some of those are bigger topics we'll talk about it more on a different uh video one of the ones I have lined out to come up soon is rmds uh some new rules happened in the last couple weeks the IRS came out with some new rules on how inherited rmds are going to be handled it's important you know how those work so we'll talk about that uh a lot of other things coming so I'm going to try to get some stuff to you if there's anything that you would like to have discussed go ahead and drop that down below once again please subscribe uh we're trying to do the best we can to help you but ask questions uh maybe I can leave you some answers down there or maybe there's some topics that I haven't thought about that would be useful to you and the whole reason I'm doing this is for you guys so once again that's all I got and we will talk to you soon h